Nice story. We need these positives in this day and age. Not just about the generosity of your ancestor but also of the willingness and thoughtfulness of the boss to get back to you so promptly. Let's bless those who care.
What are the criteria for determining who gets the scholarship?
yes, nice story. Thanks for sharing it
In general, scholarships are given out based on financial need. I was told the college has a really good computer system for matching up available scholarships (and their restrictions) with students in need.
And it's all done one year at a time, so that a different student will get this scholarship each year, while current student gets aid from a different one (or ones) each year until they graduate.
What a great story. As usual, thanks for sharing! I was the recipient of a number of such scholarships in undergrad, and wrote a couple of such letters. Very cool to hear the other side of the story.
Indeed, that's a great story. Kudos to Princeton for having the students write those letters. If they don't know already, I think it is equally important for the students to know how the scholarship came about.
BTW, about that scratch on your new Red Bike -- you need a new bike. Or at least you tell Gail that you really should have a new bike, sort of safety and performance things, details are hard to explain but you read about it in Bicycling magazine, but you will continue to make due, demonstrating your reasonableness and frugalness, but planting the seeds of sympathy and agreeableness in her that you then leverage sometime later down the line. It helps to at some point when Gail is around have your friends look at the scratch, slowly shake their heads, and say, "Peter, I don't know how you ride this." When it comes to bikes, you need to borrow a page from TGIF who navigates 100m in the future -- you need to plan your next bike purchase or upgrade 6 months ahead of time.
Ah, a man of great wisdom, I'd best pay attention.
Looking 100m into the future, and that's not very far, I think the two most important upgrades I will need that I don't have now are an electric motor and training wheels. That's in addition, of course, to a scratch-resistant paint job. :-)
Ok, I have to ask...if one started with 10k, and the income each year was awarded, how did the balance end up as a million?
Historically, investing in equities (stocks) has been an excellent investment, as long as you have a long-term perspective and a strong stomach. My assumption is that for much of the time scholarship funds were mostly invested in some mix of stocks and bonds (more recently, last 20 or 30 years, maybe also commodities, real estate, various other things).
As an illustration, below is a chart of the last 100 years for the Dow Jones Industrials, unadjusted for inflation. Not so shabby. For comparison, the value of funds invested in a CD (rolled over whenever it matured) would be represented by a horizontal line.
Nice motor! I've been hearing about them. Push a button and you have an extra 200 watts, I think that would maybe triple current output.
Almost worth getting just to see the surprise on Phil's face.... :-)
Right, I get that the stock market has increased, but wouldn't granting income as scholarship mean that anything above 10k would be awarded each year? At least, that is how I see it, but then, I am being a bit too pendantic/literal perhaps. :)
Regardless, very cool!
Income would be paid out in scholarships, but not the increases in value. (The chart shows the value with dividends not reinvested.)
At least I think that's the way it used to be. I think now they pick some percentage (4%??) and just distribute that each year.
That certainly makes sense, otherwise there could be some ridiculous amounts paid out.
But, more importantly! A huge scholarship that is still going strong after 100+ years. What a legacy that is.
For example, the USOF endowment fund pays out 4% of net assets each year to OUSA, but that is less then the long term growth, so the total endowment assets keep growing each year
Princeton reports generating 13% annualized returns over the past 25 years or so, but this does reflect, as PG notes, something of a revolution in endowment management starting in the 1980s, as fixed income heavy portfolios gave way first to equities, and then to alternatives. Andy Golden, who has presided at PRINCO, is an acolyte of this approach.
Most endowments have a formulaic approach to giving, often smoothing the past few years of AUM. 4%-5% is typical.
In any case, if you generated a 10% total return from your investments (such as the return from US equities over the past 100 years) that surplus of investment returns over distributions (on average) should provide for a growing corpus.
That, beneficent donors, and extremely favorable tax treatments partially account for why major ivy league endowments are in excess of $20BN.
I can see that your generosity is genetic. What a great string of philanthropy. Loved the story.
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