Creating a scholarship fund is a wonderful way for nonprofit organizations to support their mission and promote positive change in the community. By helping individuals attain higher education or job training, scholarship funds empower recipients to advance their careers and make a difference. This guide will walk you through the key steps to properly establish a scholarship fund under your nonprofit.
Determining Your Scholarship Criteria
The first step is deciding who the scholarships will target and what qualifications they must meet. Some common criteria nonprofits consider include:
Field of study: You can focus scholarships on specific majors or career paths that align with your mission, such as education, sciences, or the arts. Alternatively, you may keep it broad and consider all fields.
Financial need: Scholarships are often awarded based partly or fully on financial need. Consider using FAFSA information or similar metrics to evaluate an applicant’s financial situation.
Academic performance: Minimum GPA requirements, class rank thresholds, or other academic merit factors are common. Balance promoting education access with incentives for strong performance.
Demographic factors: Some nonprofits tailor scholarships to specific groups, such as women, minorities, or residents of certain areas. Ensure any demographic criteria comply with nondiscrimination rules.
Career goals: You may want recipients to commit to careers or fields directly serving your nonprofit’s mission after completing their education. Define expectations clearly.
Having clear, published criteria establishes fairness and transparency in the selection process. Consult advisors to ensure your criteria align with your mission and follow relevant laws.
Setting Up the Fund Mechanically
With criteria set, it’s time to establish the fund mechanically. Most nonprofits partner with a community foundation or commercial scholarship administrator who can properly manage the money and selection process on your behalf according to your criteria. Key steps include:
Opening an account: Scholarship administrators have dedicated accounts to hold restricted scholarship funds separately from your operating funds.
Minimum funding amount: Most administrators require a minimum initial contribution, often $10,000-$25,000, to establish the endowed fund. Plan fundraising accordingly.
Naming the fund: Call it something reflective of your mission and the donors who make it possible, such as “The Smith Family Environmental Education Scholarship.”
Investment strategy: Funds are typically invested similarly to university endowments for steady, inflation-adjusted growth over decades. Low-risk strategies are common.
Awarding timeline: Work with the administrator to establish predictable award cycles, such as annual awards distributed each spring. Promote deadlines clearly.
Clearly define roles, authorities, and expectations with your administrator partner through a formal gift agreement. Strong back-end setup ensures smooth, legal operations for years to come.
Promoting and Fundraising for the Scholarship
No scholarship fund can operate without sufficient, ongoing financial support. Thoughtful promotion and fundraising are essential to its long-term success. Consider these promotion tactics:
– Website: Highlight the scholarship prominently on your site, linking to the application. Feature past recipients’ stories.
– Print materials: Develop a brochure or one-pager detailing the scholarship and donor opportunities to share at events and with partners.
– Earned media: Pitch local newspapers on announcing the scholarship’s launch or awarding of new recipients.
– Social media: Share meaningful updates using targeted hashtags to engage potential applicants and donors online.
For fundraising, host annual appeals, galas recognizing major donors, or earn-a-scholarship campaigns allowing community members to directly sponsor scholars through crowdfunding. Pursue matching donation challenges from local businesses or foundations.
Consider including planned giving options like bequest intentions in your promotional materials as well. Regular communication keeps the fund top-of-mind as a high-impact investment.
Administering the Selection Process
Once applications start rolling in, it’s time to thoughtfully review each candidate. Ensure your process aligns fully with the previously established criteria and follows all legal guidelines. Key administrative steps include:
Application review criteria: Develop clear judging rubrics to objectively score applicants in each criteria area. Train reviewers accordingly.
Review committee: Assemble a diverse panel of volunteer experts not personally invested in any candidates to prevent bias. Rotating members keeps it fresh.
Blind review: Remove identifying details from applications to focus solely on merits before committee meets. Some use online platforms for this.
Selection meeting: Committee privately discusses top candidates according to rubrics. Consider interviews for finalists if needed.
Award notification: Inform selected recipients first with personalized emails or letters. Then announce publicly online and with earned media coverage.
Recipient support: Connect winners with mentors, offer thanks events, provide biannual progress checks, and more to maximize their success.
Professional, impartial administration builds trust that the most deserving students consistently receive support through your fund. Celebrate results each cycle!
Stewarding the Fund Long-Term
Sustained commitment allows your scholarship to grow its impact exponentially over decades. Key long-term responsibilities include:
– Ongoing fundraising: Maintain regular outreach reminding supporters of accomplishments and inviting continued investment.
– Investment oversight: Review fund performance annually with your administrator. Adjust strategy as needed.
– Records maintenance: Archive all application materials, selection documents, award disbursements for future accountability.
– Alumni engagement: Nurture relationships with past recipients as ambassadors through networking events or mentoring programs.
– Policy review: Revisit criteria, selection procedures, and partnership agreements every 3-5 years to optimize relevance.
– Succession planning: Train successors to shepherd the fund for generations to come as original leaders retire.
Excellence in lifelong stewardship cultivates a scholarship tradition that will touch countless lives and honor your organization’s legacy long into the future. With care, the impact can truly be endless.
In closing, establishing a meaningful, sustainable scholarship program exemplifies the heart of any nonprofit’s purpose. By thoughtfully following the guidance in this post, you can empower students for years to come while bringing your mission to life. Please feel empowered to start the process – your community will thank you.