Back-to-Back Positive Years: Independent Schools Report 12.3% Return on Endowment Assets for FY2024; 10-Year average returns hold steady at 6.7%
Returns Positive; New Gifts to Endowments Fell, Use of OCIO Increased
WILTON, Conn., February 20, 2025 — Institutions participating in the Commonfund Benchmarks Study® of Independent Schools (CSIS) for the 2024 fiscal year reported an average annual return of 12.3 percent on their endowment assets. This marks the second year in a row of strong positive returns and is the first Study year since FY2020 that one-year returns did not fluctuate drastically (for example, the difference in returns from FY2020 to FY2021 was 37.1 percentage points, and from FY2021 and FY2022, 20.5 percentage points). (All returns are reported net of fees. Fiscal year 2024 covers the period from July 1, 2023, to June 30, 2024, and coincides with the budget year of most independent schools.)
Longer-term portfolio gains, of primary importance for the financial health and sustainability of perpetual institutions, were positive: five-year average returns were 7.7 percent in FY2024, up from 6.0 percent in FY2023, while the ten-year average return of 6.7 percent was unchanged from the prior year. New data collected in this year’s Study show an average 8.0 percent 15-year return, and 6.9 percent 20-year return.
George Suttles, Executive Director of Commonfund Institute, and Jeffrey Shields, President and CEO of NBOA, noted in a joint statement that another year of strong returns and newly revealed long-term gains are welcome signs. “Despite pressures from markets, inflation, and enrollment, this year’s Study shows that long-term endowment gains can serve as an anchor of stability for institutions. After a few years of big swings up and down, we can rest assured that in the long-term – with 15-year and 20-year returns of 7-8 percent – endowment stewards are helping meet the missions of these perpetual institutions.”
Two hundred twenty-one independent schools representing roughly $15.6 billion in combined endowment assets provided data for the Study. Data gathered in the CSIS are aggregated for all participants and are segmented into three size cohorts: institutions with endowment assets over $50 million; those with assets between $10 and $50 million; and those with assets under $10 million. Institutions participating in the Study comprise day schools, boarding schools and schools that are a combination of both, and some analysis in the study segments data by day schools and those with boarding. Independent schools are private, nonprofit institutions enrolling students from pre-kindergarten through 12th grade. In the U.S., approximately 10 percent of the student population attends an independent school, according to the National Association of Independent Schools (NAIS).
Commonfund conducts this annual study of independent school endowment management practices and policies in conjunction with NBOA: Business Leadership for Independent Schools, the only national nonprofit association focused exclusively on fostering financial and operational excellence in independent PK-12 schools.
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