The Story Budgets Tell

As educators, we are frequently asked what we are doing to address the rising costs of college. Such increases are largely brought about by the fact that we incur all the (also rising) costs of a small city (utilities, housing, restaurants, security, transportation, entertainment/athletics, etc.), but have only a couple of revenue streams. That said, we work hard to offset College costs by holding down expenses and attracting donors.

A healthy budget, like that of Meredith College or any organization (and, for that matter, private households), requires a balance of revenues and expenses. As is typical with almost all institutions of higher education, our expenses are primarily tied to employee salaries because we are paying for experts and their high-quality credentials, while our revenue is primarily generated through tuition, housing, and food. We are also blessed with donors who are loyal to the College and consistently give to support our work, adding to our revenues.

So where do these dollars go? While some may go to the “bottom line” to pay current bills or to fund strategic initiatives, other dollars go to our endowment, which is the “savings account” from which we draw a percentage of funds for our annual budget, known as an endowment “drawdown.” Gifts to the endowment often come with heavy restrictions for usage, established by donors who give money to be used in only one way (i.e., for an academic program, athletics, scholarships, DEI initiatives, facilities, or other priorities).