The ScholarShare Investment Board ("the Board") deposits all scholarship funds into the ScholarShare Trust. The Board determines how these assets will be invested. Currently, funds are invested in a TIAA-CREF Life Insurance Company Funding Agreement. This Funding Agreement guarantees to the ScholarShare Trust a return of principal and a current minimum rate of return of 1% per year with the possibility of additional returns declared in advance by TIAA-CREF Life Insurance Company.
The scholarship funds earn interest from the day of deposit into the ScholarShare Trust. When an award is claimed, the award and interest are transferred to a Student Scholarship Account naming the State of California as the Account Owner and the student as the Beneficiary. Scholarship awards, including earnings, are owned by the State of California until they are withdrawn to pay for the student's qualified higher education expenses at an Eligible Educational Institution.