Princeton University’s endowment generated a 3.9% return on investment for the entire fiscal year 2024 (FY24), which ended June 30, according to an announcement released by the university on October 24. However, this year’s investment profits have not led to an increase in donations. The size of the overall endowment matches the 2024 value with the 2023 value, both at $34.1 billion.
Notably, this is the first endowment gain in two years reported by Princeton University Investment Corporation (PRINCO), the university arm that manages the endowment, with a 1.5% and 1.7% return in FY2022 and FY2023, respectively. There was a loss.
For the first time in nearly 30 years, the fund is no longer managed by PRINCO’s former president, Andrew Golden, who retired in June. During his tenure, endowments increased nearly tenfold, but there were only three negative investment returns during that time. The fund’s success is attributed to Golden’s aggressive investment strategy, which targets an annual return of 10%.
PRINCO’s new president, Vincent Tuohey, declined to comment on the donation announcement.
In an April interview with the Financial Times before the end of his term, Golden said Princeton’s endowment could take a hit in the face of what he described as the “worst liquidity environment in history.” I warned you that there is. Despite the golden signal, the 2024 return will mark the first time the fund has recorded a positive investment return since 2021, but it is far smaller than the same year’s historic investment return of 46.9%.
Plinko and the university did not respond to repeated requests for comment on how investment returns have improved since Golden’s interview with the Financial Times.
Princeton University maintains one of the largest endowments in the country, topped by Harvard University, whose endowment will increase by 9.6% to $53.2 billion from July 2023 to June 2024. As of August 31, Stanford University has a total of $37.6 billion in endowments. The university boasts an endowment of $40.7 billion as of June 30, 2023. Details of Yale’s endowment for the fiscal year ending this June have not yet been released.
Some comparable institutions, including Harvard University and Stanford University, typically detail the amount spent on university operating expenses. According to a Princeton University announcement, 70% of the undergraduate financial aid budget will be distributed from endowment funds, as well as funding for the university’s research, service and social impact programs, campus construction, low-income first-generation, veterans, and transfer students. The proceeds will also be donated to outreach programs supporting the. .
According to the announcement, distributions from the endowment for university operations were $1.7 billion in fiscal year 2024. In fiscal year 2023, Harvard University spent $2.4 billion, and Yale University spent $1.8 billion.
The board set the operating budget for fiscal year 2023-24 at $2.92 billion, up from $2.66 billion the previous year.
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The university reports that the endowment is helping to fund research in “areas such as quantum computing, artificial intelligence, climate science, and insights into diseases such as Alzheimer’s and cancer.” . On October 3, the university announced it would resume accepting research funding from fossil fuel companies that do not meet dissociation criteria, sparking a backlash from various groups on campus.
The Admissions and Financial Aid website states that the average annual undergraduate aid package for Princeton students is $73,000 for students receiving aid, while the financial aid program covers tuition, housing costs for “most families.” , details that it covers 100 percent of food, books, and personal expenses. Earn up to $100,000 a year.
The 2023-24 undergraduate financial aid budget was increased by 26.4 percent to a total of $268 million, accounting for more than 9 percent of the university’s total operating budget of $2.92 billion.
Victoria Davis is an assistant news editor at The Prince magazine, which covers university operations.
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