There are scholarships at my University that have been around for a few decades. Do people top them up constantly?
In: Economics
Typically these scholarships are not all given out of the same principal amount. The donated amount, called an endowment, is usually invested and actively managed in a way that generates more money, and this money is given out for the scholarships. The bigger the endowment, the easier it is to make money off of it in a relatively safe and consistent manner, which allows for long term stability. It may also be grown and expanded through donations or as a natural consequence of investing, since long term investments can easily grow to a much larger size over time.
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