While the majority of foundations are built for perpetuity, we have seen increased interest from philanthropists to adopt the “spend down” mentality. As momentum grows, so have the stakes, and foundations have an opportunity to determine how they leave their mark on society. If the issues an organization is trying to solve require urgent action, then a dollar of philanthropy today is more valuable than a dollar of philanthropy in the future. Foundations must consider this “time value of philanthropy” when determining whether making a significant impact today, when it is needed most, will benefit society and outweigh the need for grant capital in the future. The circumstances have changed, and foundations should consider doing so as well. 

Brad Harrison is co-head of impact investing at Tiedemann Advisors. Jill Shipley is head of family governance and education at Tiedemann Advisors.

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