A number of colleges allow students to invest a piece of the endowment pie. Now, students at five schools will get to give money away.
Fidelity Investments announced Thursday that it is launching a program called Students4Giving, designed to get young people involved in philanthropy, in partnership with Campus Compact, a coalition of more than 1,110 college and university presidents.
Fidelity will provide $15,000 in a donor-advised fund to five schools — Boston University; California State University, Fresno; Portland Community College in Portland, Ore.; the University of North Carolina at Chapel Hill and Whitworth University in Spokane, Wash.
A donor-advised fund is a type of giving program that allows people to make a contribution and claim a tax deduction immediately, but then invest the money for future grants.
Students participating in nonprofit and philanthropy courses will oversee the program's funds, solicit grant applications from charities in their communities and recommend donations.
‘Giving money away is very difficult work’
"This will enable them to teach the students about philanthropy and to tackle community problems," said Maureen Curley, president of Campus Compact. The five schools were selected from among 35 proposals.
"I think giving money away is very difficult work," said Curley. "There are many good causes."
Even though students will have to give away more than half the money by the end of the spring term, organizers hope the programs will become permanent and models for other schools.
"I'm very excited to see the effect these dollars will have in the community," said David Giunta, president of the Fidelity Charitable Gift Fund.
Morgan Simon, co-founder and executive director of the Responsible Endowments Coalition, said a number of schools allow students to get involved in the investing process, but she believed the program marked the first time students could use donor-advised funds to donate money.
"I think that giving them the experience of giving away money will hopefully help them think more about philanthropy," said Simon.
While each program varies, students at the participating schools will learn about non-profits, donor-advised funds and philanthropy before soliciting grants from local charities. Students will make recommendations to Fidelity Charitable Gift Fund, which makes the distribution if the charity is legitimate.
Lynn W. Blanchard, director of the Carolina Center for Public Service at the University of North Carolina, said the school already has a program to encourage volunteerism and a class on philanthropy. The donor-advised fund will enable them to expand that program, which has included grant-making.
"One of the messages we really want to get across to our students is that public service includes volunteering, but there's much more to it than that," she said. "It's important to feed people at a soup kitchen, it's important to sit on boards and it's important to know why people are hungry."