What percentage of endowment earnings are spent?
The college’s endowment spending policy is based on a spending rate of 4.7 percent of a sixteen-quarter moving average of market values at the end of the previous year. For fiscal year 2008, the effective payout percentage was approximately 3.8%, based on the market value of the endowment of $334.811 million as of May 31, 2008.
The college uses a “smoothing policy” to allocate funds from the endowment to the endowed scholarship and endowed fund spending accounts. As a result of this policy, scholarship amounts in the 2010-2011 school year will be nearly the same as the amounts available in 2009-2010. Given that the market value of the endowment increased by over 10% in 2009-2010, the effective spending or pay out rates will decrease from about 5.9% to about 5.4% in 2010-2011.
