Harvard Endowment Reaches $32 Billion

By Douglas A. McIntyre Updated Jan 29, 9:24AM EST · Published Jan 29, 6:30AM EST

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America’s colleges and universities have the equivalent of the richest 10%, just as the population does. At the top of that elite group are Harvard, Yale, the University of Texas System, Stanford, Princeton and MIT. Among them, their endowments in fiscal year that ended on June 30, 2013, reached $121 billion.

New research from the National Association of College and University Business Officers:

… across the U.S. The 835 institutions participating in this year’s Study represented $448.6 billion in endowment assets as of June 30, 2013.

So, six institutions have 27% of those total funds. Harvard’s alone was 7% of the total. As a group, the 835 institutions posted an average of 11.7%. Only one of the top six bested that number — the University of Texas System at 12%.

The divide between the richest colleges and universities is just as pronounced when the institutions with $5 billion endowments are measured. Only 19 reached that level last year. Only 83 had endowments over $1 billion.

The level at which the richest colleges and universities can fund education out of their endowments is extraordinary:

Endowments remain a significant source of support for higher education. Participating institutions reported that an average of 8.8 percent of their operating budget is funded by their endowment, ranging from a high of 16.2 percent for institutions with assets over $1 billion to a low of 2.5 percent for institutions with assets under $25 million. Many institutions use their endowment income to fund financial aid and other programs for students and faculty.

Elite colleges, at least in theory, can fund better educations because they can afford to. The poorest colleges have virtually none of that advantage.

There is not much difference between the wealthiest colleges, the wealthiest people and the wealthiest corporations when it comes to buying and affording what they want. The pyramid narrows quickly as it reaches a top.

About the Author Douglas A. McIntyre →

Douglas A. McIntyre is the co-founder, chief executive officer and editor in chief of 24/7 Wall St. and 24/7 Tempo. He has held these jobs since 2006.

McIntyre has written thousands of articles for 24/7 Wall St. He is an expert on corporate finance, the automotive industry, media companies and international finance. He has edited articles on national demographics, sports, personal income and travel.

His work has been quoted or mentioned in The New York Times, The Wall Street Journal, Los Angeles Times, The Washington Post, NBC News, Time, The New Yorker, HuffPost USA Today, Business Insider, Yahoo, AOL, MarketWatch, The Atlantic, Bloomberg, New York Post, Chicago Tribune, Forbes, The Guardian and many other major publications. McIntyre has been a guest on CNBC, the BBC and television and radio stations across the country.

A magna cum laude graduate of Harvard College, McIntyre also was president of The Harvard Advocate. Founded in 1866, the Advocate is the oldest college publication in the United States.

TheStreet.com, Comps.com and Edgar Online are some of the public companies for which McIntyre served on the board of directors. He was a Vicinity Corporation board member when the company was sold to Microsoft in 2002. He served on the audit committees of some of these companies.

McIntyre has been the CEO of FutureSource, a provider of trading terminals and news to commodities and futures traders. He was president of Switchboard, the online phone directory company. He served as chairman and CEO of On2 Technologies, the video compression company that provided video compression software for Adobe’s Flash. Google bought On2 in 2009.