Topic: Endowment
2 posts tagged “Endowment”.
The Spending Rule
Spend a flat percentage of your pot's latest value and your income lurches with the market. Endowments use a smoothing rule so spending drifts gently and the capital base is protected in the lean years. The same idea works for a household.
Think Like an Endowment
A retirement pot that must last thirty years behaves less like a savings account and more like a university endowment. David Swensen broke the old 60/40 "prudent" rule — and showed why a long horizon can carry a larger equity tilt.