WealthForTheWorld
Giving Methodology
WealthForTheWorld donates 2 percent of its assets annually.
The fund's expected annual return is around 7% per annum, allowing its assets to grow despite regular payouts. The resulting compounding effect ensures that, over the long term, the fund can distribute more money than was originally contributed.
The payout rate of 2 percent is calculated so that the total sum of payouts over time is maximized. Expected capital returns, the diminishing marginal utility of additional donations, and the risks of delayed payouts are all taken into account in the calculation.
You can find our model for calculating the optimal donation rate here.
It was developed in collaboration with the economist Stefan Pauly and is based on research on philanthropic capital by Philip Trammell from the Global Priorities Institute (University of Oxford).
It was developed in collaboration with the economist Stefan Pauly and is based on research on philanthropic capital by Philip Trammell from the Global Priorities Institute (University of Oxford).
Based on the calculated optimal donation rate of 2 % and an expected real market return of 7 %, the donation payouts and the asset development (= the impact) of donations to WealthForTheWorld can be calculated:
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