Planning for Higher Education Journal

Should Endowment Spending Rates Increase?

From Volume 29 Number 4 | Summer 2001
By Donald L. Basch, James D. Basch

Since investment returns on colleges' endowments have been strong in recent years, the question arises of whether colleges' endowment spending rates should also be revised upward. The article shows how recent returns change the historical averages upon which the endowment spending rate may be based, highlights how the extent of change depends on how far back one's historical perspective goes, and warns against employing an historical perspective so short as to focus solely on recent buoyant returns.

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