Endowments and Foundations Overview

CFA Level III: Wealth Management and Institutional Investing · 4:11

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Lyrics

[Verse 1]
There's a special kind of fund that's built to last
Endowments and foundations, growing from the past
Universities and charities need money every year
But they want their principal to never disappear

[Chorus]
Forever funds, forever goals
Spend the growth but keep it whole
Balance today with tomorrow's needs
Forever funds plant lasting seeds
Principal stays, the income flows
That's how perpetual giving grows

[Verse 2]
Endowments serve the schools and institutions
Foundations give to causes, charitable solutions
They both follow rules that keep them going strong
A spending rate that's careful, planned to last lifelong

[Chorus]
Forever funds, forever goals
Spend the growth but keep it whole
Balance today with tomorrow's needs
Forever funds plant lasting seeds
Principal stays, the income flows
That's how perpetual giving grows

[Bridge]
Five percent is typical, the spending rate they choose
Inflation eats away, so they can't afford to lose
Investment returns must beat the money they give out
Or future generations will go without

[Verse 3]
Current beneficiaries want funding right away
But future needs matter for another day
The board must balance present good with years ahead
Sustainability keeps the mission fed

[Chorus]
Forever funds, forever goals
Spend the growth but keep it whole
Balance today with tomorrow's needs
Forever funds plant lasting seeds
Principal stays, the income flows
That's how perpetual giving grows

[Outro]
Perpetuity's the key, forever they must be
Endowments and foundations, giving generously

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