Institutional Endowment Spending Policy Calculator
Turn your endowment spending policy into a yearly payout budget.
- With a $3 billion endowment and a 4.5% spending policy, how much can we spend each year?
- What spending rate would give us $135 million a year from a $3 billion endowment?
- If our endowment falls to $2.5 billion, how much could we spend at the same 4.5% rate?
Endowment spending at a glance
Estimate based on the inputs shown.
4.5% of current endowment value.
How it is calculated
Annual spending = endowment value × spending rate; implied rate = annual spending ÷ endowment value
This tool uses current value. Many endowment policies use the average value over a period of time instead.
Read the result in context
An endowment spending policy turns a yearly rate into a payout budget. You can also work backward from a budget to find the rate. Both use the same current endowment value here.
What is an endowment spending policy?
It sets how much an endowment pays out each year. Often, it applies a set rate to a measure of asset value.
How is an endowment payout calculated here?
Multiply the current endowment value by the yearly spending rate.
Does this use a rolling average?
No. It uses the current endowment value you enter. Many policies use the average value over a few years instead.