Intergenerational neutrality

[cfa09]

Where does this concept apply ?
I’ve come across the term a couple of times and assumed that with regard
to endowments they must adhere to this somehow (in addition to a minimum spending rate requirement) to maintain tax free status.
Anyone ?

 

[McLeod81]

Don’t blow it for future generations by spending down the portfolio and failing to keep up with inflation. There is a need for endowments to balance the needs of current recipients with future recipients, so they need to protect against inflation and maintain a responsible spending policy.

 

[cfa09]

Thanks McLeod ,

 

[mwvt9]

Trusts must also balance the income beneficiary with the remaindermen (those that get what is left).