While, over the years Alpha Rho alumni had given "aid and assistance to needy active members" the first recorded move toward a student aid program was in 1933 during the depths of the great depression when in order to keep a senior in college the Trustees of the Alpha Rho Alumni Association appealed to the alumni members of Alpha Rho for contributions to a Student Aid Fund. The same year, 1933, marked the introduction of the Insurance Program which the Trustees urged the Alpha to adopt. While student aid was not a prime purpose of the Insurance Program, it was a stated objective that, once the mortgage was liquidated, funds would be set aside for student aid. The Insurance Program which provided for a pledge of $250 to be made by each member was approved unanimously by the Alpha and was continued as a mandatory condition of membership until the adoption of the Alpha Building Program of Chi Psi approved by the 121st Convention of the Fraternity in Ann Arbor, June 1962. The program adopted by the Alpha in 1933 provided a substantial base for student aid.

The desire to provide additional funds for student aid was enhanced by the members of the 1931 delegation when they made the first group effort to establish a fund in memory of their classmate, G. L. C. Strieder, P 1931, "for the purpose of establishing additional means of student aid." This initial effort, during 1939, was increased by contributions from members of the 1931 delegation and friends in the years that followed and particularly several gifts in memory of John R. Armstrong, P 1931. In 1978 these gifts, along with the Strieder Fund, formed the core of the 1931 Delegation Fund.

During 1940, a modest legacy from Mrs. D. W. Skellenger in memory of her husband of the class of 1882, was received by the Association Trustees and was set aside as the Daniel W. Skellenger Fund. The Strieder and Skellenger Funds, modest at their inception, were increased by dividing the 1933 Student Aid Fund, which had been repaid, between them.

Before the actual hostilities had started during World War II, the Alpha was saddened to learn that Walter W. Winika, P 1936, (Lt. U. S. Naval Air Force) had been killed while on patrol duty at Trinidad. To the money received from his participation in the Insurance Program was added several gifts from friends and classmates to establish the Walter W. Winika, P 1936 Fund. As the war went on, the list of fine young Brothers of our Alpha who lost their lives in the service of their country during the period 1942-1946 increased to eleven. With the report of each fatality, the Association Trustees took immediate action to memorialize the Brother and established a Fund in his memory, in most instances using proceeds of the individual's participation in the Insurance Program as the initial basis of the Fund. In addition, families, friends and the trustees also contributed to the established Fund. The Brothers lost during World War II along with a casualty of the Vietnam (E. K. Kissam, Jr., P 1955) and Korean (J. Clendinning, III, P 1947) conflicts constitute the Gold Star Funds of the Foundation. 

In 1948, Henry G. Atwater, P 1904, President of the Alpha Rho Alumni Association, took steps to formalize and to incorporate the Alpha Rho Memorial Foundation. David Kelly, P 1920, gave generously of his time and services, preparing the incorporation documents and framing the by laws. The Certificate of Incorporation is dated March 12, 1949, just two days before the 70th anniversary date of Alpha Rho on March 14.

The certificate provided for a corporation, not for pecuniary profit, but "to aid, encourage, promote and contribute to the education of members of Alpha Rho." The certificate also provided that all alumni of Alpha Rho and all non Chi Psis who contribute to the Foundation are members and receive a copy of the annual report issued by the Foundation. The fledgling Foundation, dedicated to serving the undergraduate members of Alpha Rho, was launched with the transfer of $5,901.84, representing the memorial funds held by the Trustees of the Alpha Rho Alumni Association, to the Foundation.