Once an endowment is activated, how much is spent each year?
To balance current and future needs, the university employs investment and spending policies designed to provide an appropriate flow of income to the operating budget while preserving the future purchasing power of the endowment assets in perpetuity. The spending rate is approved by the Board of Trustees and is currently set at a rate of 5.5 percent of the average value for the previous three calendar year-ends. In years of particularly high returns, the Board has limited the amount the payout could increase from the year prior; this policy helped smooth the effect of market fluctuations and allowed Duke to build its endowment in anticipation of leaner times.
