MIT's Endowment Rises to $29.2 Billion, but Its 10.3% Return Trails Harvard, Stanford and Most Peers

The Massachusetts Institute of Technology's endowment grew 6.7% in the 2026 fiscal year to $29.2 billion, excluding pledges, according to the Report of the Treasurer released on Oct. 2 and reported by The Tech, MIT's student newspaper. The fiscal year ended June 30.

The report showed a 10.3% return on the endowment for the year. That figure is below the 15.5% preliminary median return for U.S. college and university endowments reported by Cambridge Associates, and it trailed the returns reported so far by several peer institutions, according to The Tech: Stanford at 31.7%, Penn at 27.4%, Harvard at 27.1% and Princeton at 23.7%.

The Tech reported that the high returns at peer schools were the largest since 2021, driven by gains in technology companies such as SpaceX and investments tied to artificial intelligence. The endowment is managed by the MIT Investment Management Company, known as MITIMCo, which had not responded to The Tech's request for comment as of publication.

Why the endowment matters to campus

The endowment, which ranks among the ten largest in the United States, is central to MIT's operations. Distributions of investment income and gains, principally from the endowment, provided about 40% of total campus revenues in 2026, according to the report as described by The Tech. About 80% of those funds are restricted to specific purposes, such as professorships, scholarships, fellowships and research.

About half of the endowment is held in donor-restricted funds regulated by the Uniform Prudent Management of Institutional Funds Act, which limits spending relative to the inflation-adjusted original gift and requires transparent management, according to the Office of the Executive Vice President and Treasurer.

Philanthropic contributions totaled $715.1 million in the fiscal year, $110.8 million above the prior five-year average, the report said.

Treasurer warns of federal pressure

In a statement to The Tech, MIT Executive Vice President and Treasurer Glen Shor, who authored the report, said that "even with robust philanthropic support and fiscal rigor, federal policy changes threaten" the Institute's ability to sustain the impact and affordability for which it is known.

The largest of those changes is the federal endowment tax. In July 2025, the Trump administration announced an increase in the endowment tax rate from 1.4% to 8% for universities with endowments exceeding $2 million per student, according to The Tech. The higher rate takes effect in the 2027 fiscal year.

In anticipation, MIT adopted a three-part strategy to cut $300 million in costs through increasing revenue, reducing costs and what the Institute calls "rebalancing." As a result, expenses in the 2026 fiscal year grew well below the 3.4% U.S. inflation rate, The Tech reported. Salary and wage costs rose 0.9%, or $19.7 million, to $2.11 billion. Spending on supplies and services rose 0.6%, or $8.6 million, to $1.37 billion.

Shor said MIT is implementing the budget measures now and that "most will be completed by fiscal 2027, while others will — as planned — be carried out on a longer timeline."

Retirement benefits and financial aid

In September 2026, MIT announced changes to retirement benefits. MIT currently matches 401(k) contributions up to 5%. After Jan. 1, 2027, the maximum match will be 3%, according to The Tech. MIT will also provide an Enhanced Pension Benefit from a separate pension fund equal to 2.5% of eligible pay. The new contribution rates will total a minimum of 10.5% of eligible pay.

Financial aid was not cut. In the 2025-2026 academic year, MIT updated its undergraduate aid policy so that families with annual incomes below $200,000 pay no tuition, and families with incomes below $100,000 pay no tuition, room or board. As a result, 88% of the Class of 2026 graduated debt-free, according to the report.

The new policy reduced undergraduate net tuition revenue by $4.0 million, or 3.5%. Shor said there are no plans to "retreat on MIT's financial aid policies."

What the report left out

The Tech noted that several campus changes were not cited in the Treasurer's Report, including the reorganization of the MIT Libraries, staff layoffs in several departments and a 20% drop in new graduate student enrollment. Asked about the libraries, Shor said the report is a "high-level account of Institute financial performance in a given fiscal year" and does not describe "all fiscal dynamics occurring or planned during that year." He said "there are no plans for further reductions to the Library services."

Graduate union disputes the picture

The MIT Graduate Student Union has been a vocal opponent of the budget changes. GSU Financial Secretary Jo Hall said the decisions reflect the administration's priority to "protect the Institute's maximum possible growth" over the needs of workers.

Hall argued that the report's rhetoric suggests that under the new tax rates "MIT will be hard-pressed to make ends meet." "This is simply untrue," Hall said. "MIT has already demonstrated this year that they can post nine-figure growth while treating the expected loss of income from the new tax as part of its FY2026 financial assessment."

Hall acknowledged the negative effects of federal policy but said it "is deeply frustrating to hear MIT complain about hundred-million dollar impacts to their billion-dollar yearly profits while closing libraries and deadlocking its workers at the bargaining table."