Spending Policy

Spending Policy2018-11-16T16:08:55+00:00

The Community Foundation of Shelby County exists to support the needs of the community both now and in the future. To achieve these goals, we apply a Spending Policy to most endowed funds. The Spending Policy disciplines spending by calculating the amount of money that can be disbursed from a fund each year. The intention is to position funds to maintain a balance between long-term investment growth and annual grant distributions.

The Community Foundation’s Policy averages a fund’s balance from the prior 16 quarters and multiplies the average by a percentage to determine the amount of annual grant dollars. Using the Spending Policy, a charitable fund keeps excess market return in favorable times and continues grant awards in unfavorable times, within certain parameters. The overall goal is that the charitable fund balance and the annual granting amount increase over time. Each investment pool has its own spending rate.

Charitable Fund rates by Investment Pool:
Conservative Pool: 3.0%
Balanced Pool: 3.5%
Growth Pool: 4.0%

Illustration of Spending Policy Amounts

Non-endowed funds do not follow the Spending Policy, as those funds have the ability to disburse total return and principal.

To learn more about Investment Pools, please click here.