(08-06-2021, 12:36 PM)Goose Wrote:(08-06-2021, 12:34 PM)winflop Wrote: Take the $2.2M and set it aside. That still leaves $6.7M. I don't blame Shaw for taking the money. I doubt any of us would turn it down. But I do blame Muir for paying him that much.
Yet ANOTHER reason to send Muir packing...unfortunately one of many.
Again, if the endowment generates the 6.7million on a recurring basis, maybe Muir has no choice.
That's now how ANY endowment works that I'm aware of.
(08-06-2021, 02:23 PM)BostonCard Wrote: The endowment payout is smoothed out to account for ups and downs in the market. Like, if the market were to ever go down (it happens, you know), it's not like there would be no payout. Typically, the payout is about 5% of the value of the endowment, so to support a $6 million base salary, the endowment principle would have to be $120 million. (narrator: the actual endowment is not $120 million). The endowment doesn't pay all of Shaw's salary, and it certainly isn't paying $6 million a year.
BC
Most endowments pay out 3-4%, not 5%. That allows for the principal to grow over time so that the payouts get larger to deal with rising costs for the recipient