The Wall Street Journal reports that a growing number of philanthropists are adopting spending deadlines and sunset provisions to ensure urgent global needs are addressed in a timely way. By granting the entirety of funds within a certain period of time, these charitable efforts are looking to have a bigger immediate impact.
Sadly, traditional foundations, which are typically set up to "last forever", only pay out roughly a mere 5% of their assets a year, and that a mandated figure.
The economic meltdown, an increased awareness of pressing environmental issues and a political climate ripe for policy change are all feeding the sense of urgency. Jennifer and Peter Buffett, the son and daughter-in-law of billionaire investor Warren Buffett; Charles Feeney, co-founder of Duty Free Shoppers Group; and Microsoft Corp. co-founder Bill Gates are among prominent philanthropists who have implemented so-called spend-down or sunset provisions in recent years.
"There are such pressing needs now, from climate change to the escalating economic challenges facing our communities; we need to get focused and step up in a big way now," said Jennifer Buffett, president of the NoVo Foundation, which aims to empower women and girls.
Limited-life foundations represent slightly more than 10% of active family foundations, according to a recent study by the