Non-profit organizations have long-term asset pools, wish to exist in perpetuity, and want to maintain the purchasing power of their investment programs. With many organizations striving to meet a spending rate of around 5% per annum, net of inflation, there is little tolerance for missteps during turbulent market environments. Creating a clear and well-defined spending policy not only helps to assure strategic alignment to your organization’s mission, but is an important means of implementing fiscal discipline around annual spending and consistency across market environments.

This paper focuses on the importance of having a spending methodology that can best meet non-profit organizations’ objectives of future spending while maintaining the asset base in negative markets.

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