Investment Assumptions (Yet Again!)

When we at PG Calc run long-term projections for charitable remainder trusts using our Planned Giving Manager (PGM) and PGM Anywhere software, we make certain assumptions about the investment performance of the trust assets. There is a fairly basic dynamic implicit in our modeling, which is that the remainder of the gift plan will be the result of the original funding amount, the amount paid out to one or more beneficiaries, and the amount earned by the trust assets. The default assumptions in PGM and PGM Anywhere are that of an 8% total investment rate of return, broken down into 5% principal appreciation and 3% income.

Using Planned Gift Projections Wisely

Planned giving software makes it very easy to estimate the benefits of a particular gift plan over its expected life. Just plug in the facts of the gift, make some simple assumptions about future investment returns and the duration of the arrangement, and voilà, out comes a presentation that describes the projected benefits of the plan in convincing detail.