Establishing a scholarship, bursary or other educational award is a popular charitable purpose in estate plans of the charitably-minded. There are two ways to create these awards: 1) establish at an educational institution; or 2) establish at a foundation or charity to target a particular community.
Generally educational institutions, particularly at the post-secondary level, do an excellent job of administering awards. In my work, however, I have found a growing number of donors who want to help students who are in a specific community and/or share challenges or characteristics. The goal of these donors is to help the student, regardless of where they intend to study. In other words, the loyalty of the donor is to the future students, not a college or university.
With community-based scholarships the vision is often very personal. The donor’s life experience informs the structure and purpose of the award. For example, a donor may describe the transformative effect that education had on his or her live, helping to grow out of poverty, isolation, or ignorance to become an educated, contributing member of society. Quite movingly, some donors never had the opportunity to be educated, or see needs in society (such as trade education) that they would like to address.
To make these visions a reality, the donor needs to find a charity that is willing to carry out the intended charitable purpose. The traditional structure is a testamentary charitable trust, but this assumes that there is a trustee willing and able to carrying out the purpose (and to address the planning challenges). There are also certain charities that run scholarship programs, including children aid societies, community foundations, service club foundations and high schools (graduating student scholarships). In every case, the charity can target a particular population or community and help students attend the college or university of their choice.
Aqueduct Foundation, a public foundation with donor advised funds, has addressed this need by enabling the creation of personal legacy funds with unique educational awards. Legacy and vision are the starting place for most donors. The awards are named after themselves or a loved one, and they create a practical link to future generations. The terms of the award are also customized. For example, a donor may specify that they want to help students from their hometown who have average marks, financial need and demonstrated leadership in the community.
Aqueduct may work with high schools, community groups, religious organizations or children’s aid societies to run the award program and identify deserving recipients. The award is then paid either directly to the student (after of proof of enrolment and other criteria are met) or directly to university of college. The aspiration is to identify students who might otherwise be forgotten and help them go to their chosen institution and program. Personal transformation starts locally.