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I think that either the amount (in real terms) goes down over time, or there is a limited time that any endowment will last. Faced with inflation, and the requ
by joncrocks 2y ago
I think that either the amount (in real terms) goes down over time, or there is a limited time that any endowment will last.
Faced with inflation, and the requirement that there is money coming out every X months, I believe it's hard for any other outcome to be achieved.
- jvanderbot 2y agoYou would think that. But there are large expert teams of money managers that ensure the amount stays the same over time (or even matches inflation), given large enough cash reserves. It's not hard. With an investment of 10,000 you can put it in a high yield savings account and get a few % / year, akin to 100/y. So A million is 10,000 / y. That's a very nice fellowhip "for free" just from a large donation. These aren't actual numbers, they're just a proof of existence of perpetual money from a one-time investment. inb4 inflation: reduce the yearly outlay by enough to reinvest so the yearly fellowship matches inflation. Your investment just needs to grow faster than inflation.