The American education system is unique, and not in a particularly good way. It is especially curious for a country that idolizes education, industry, and entrepreneurship to saddle its youngest generations (who have yet to have fully formed brains) with hundreds of thousands of dollars in educational debt that they will struggle to pay off for the rest of their lives. Often failing to do so before they die.

Free education for university students is an achievable, worthwhile, wise, and affordable dream. Only misinformation and greedy, powerful individuals keep it from becoming a reality.

That being said, wealthy individuals often donate huge amounts of money not to students attending universities, but to the universities themselves, usually in exchange for a building in their honor or a plaque with their name on it. These donations are added to the university’s endowment fund.

But what is an endowment? An endowment is a fund or investment used for a specific purpose as defined by a donor or a will. Usually, an endowment is kept intact, maintaining its value, and the interest or gain of the endowment is then used for the intended purposes. This means the endowment can be used indefinitely. Endowments are not unique to universities.

So, in the interest of illuminating the world of university endowments, we compiled a list of the ten largest university endowments in the United States.

All these data are taken from the NACUBO and are current as of 2023.

Why Are We Talking About This?

The American university system is complicated and rife with corruption and misinformation. One of the best ways to begin to reform our broken system is to learn about it, how it works, and where it can be improved. Understanding university endowments is just one piece of that process.

#10 University of California

• Size of Endowment: $17.6 billion

The University of California is a system of ten campuses in California, and many research centers and other academic locations. It was founded in 1868. Over 295,000 students attend the University of California.

It costs $41.6 billion every year to operate the University of California, and the state of California covers about $3.4 billion of that. Most of the money to pay for the university comes from the revenue of its medical centers (of course, only in America would for-profit medical facilities be able to pay for a university), in the amount of 39% of the total annual budget.

#9 Michigan

• Size of Endowment: $17.8 billion

The University of Michigan is the oldest university in Michigan, founded in 1817. There are more than 52,000 students who enroll at the university every year.

University endowments are actually a collection of separate and individual funds that can only be spent according to the desires of the people or organizations that donated the money. For the University of Michigan, its endowment is split between 12,400 different funds.

It takes $11 billion to operate the University of Michigan every year, and even though it is a public university, the state of Michigan only contributes to around 3% of the total budget every year. Most of the money (around 58%) needed to run the institution comes from its medical facilities, college athletic programs, and student facilities like housing and publications.

#8 Texas A&M

• Size of Endowment: $19.2 billion

Texas A&M was founded in 1876, as the first public university in Texas, and has the largest student body of any university in the United States with more than 72,982 students every year. It kept the A&M designator to honor its origins even though it is no longer an agricultural and mechanical institution.

The entire Texas A&M University System includes eleven individual universities and multiple additional agencies. It is one of the top military universities in the United States, and most of the students are rich white people.

#7 UPenn

• Size of Endowment: $20.9 billion

The University of Pennsylvania is a private university founded by Benjamin Franklin 283 years ago in 1740. He created the institution to train the future leaders of America in public service and commerce. It is the fourth-oldest university in the United States. Multiple faculty and students of UPenn were involved in the writing and signing of the Declaration of Independence and the United States Constitution.

UPenn has the largest private police force in all of Pennsylvania with more than 117 employees. Its school of education and school of business have been ranked the top professional schools in their area in the United States.

#6 MIT

• Size of Endowment: $23.4 billion

The Massachusetts Institute of Technology is a private university based in Cambridge, Massachusetts (obviously). It was founded in 1861 and has around 11,900 students every year.

MIT’s engineering school has consistently ranked #1 in the world for several years. It is one of the top leaders in science, computer science, and engineering in the world. MIT has been a strong proponent of the open-source movement, making its syllabi, exams, lectures, lecture notes, and class content available for free online.

#5 Princeton

• Size of Endowment: $34 billion

Princeton is another private university based in Princeton, New Jersey. It was founded in 1746 and has the largest endowment per student of any university in the world. It has around 8,500 students and costs around $2 billion to operate the university every year.

Princeton has consistently placed at the top or near the top of the best universities in the world, this includes rankings for the best school overall and its engineering, economics, and mathematics schools.

Very unique among American universities, Princeton does not offer academic or athletic scholarships for students and covers all the costs of attending for students from families that earn less than $100,000 per year.

#4 Stanford

• Size of Endowment: $36.4 billion

Stanford is a private university founded in 1885 and is based in Stanford, California. Contrary to popular belief, it is named after Leland Stanford, a wealthy railroad baron, in memory of his son (this was back when rich people actually contributed meaningfully to society instead of building rockets and flamethrowers and buying social media companies because their feelings got hurt).

If you combine all the companies that were created by alumni of Stanford University, they become the tenth-largest economy in the entire world. Around 17,500 students attend the university every year.

The enormous Stanford endowment only covers around 22% of the university’s annual expenses.

Stanford covers the cost of its high tuition for all students from families earning less than $65,000, and all families earning less than $125,000 per year are not required to pay any room or board costs. Families who earn up to $150,000 per year can have tuition costs significantly reduced. Stanford remains the most selective university in the United States, with an acceptance rate of just 4% of all applicants.

#3 Yale

• Size of Endowment: $40.7 billion

Yale University is another private institution in New Haven, Connecticut founded way back in 1701, and the third-oldest university in the United States. The first PhD graduate in the United States graduated from Yale in 1861 and it has the third-largest academic library in the country.

Yale has a long and complicated history when dealing with faculty and students, including ignoring student mental health and dismissing mental health issues, firing professors for getting involved in campus labor issues, and not treating workers with respect. This has led to lawsuits and numerous strikes.

#2 University of Texas

• Size of Endowment: $44 billion

The University of Texas System is an expensive network of nine universities and five health institutions. It is headquartered in Austin, Texas, and has over 250,000 students attending every year. It costs more than $26 billion every year to run the system of the University of Texas.

The University of Texas is a public university system and is the largest university system in Texas. As a result, it is also one of the largest healthcare systems with more than 83,000 healthcare professionals employed by the university.

#1 Harvard

• Size of Endowment: $50.7 billion

Harvard is a private university with three primary campuses and is headquartered in Cambridge, Massachusetts and founded all the way back in 1636, making it the oldest university in the United States. Its age, consistently high rankings, wealth, and strong influence make it one of the most powerful and prestigious universities on the planet.

Harvard has the largest university endowment of any institution in the world, and only $2 billion of that endowment is used to fund the operations of the university, 22% of the university budget is funded through tuition, fees, and room and board payments.

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