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Think Like an Endowment

While many investors (and their advisors) still think about investment portfolios in terms of cash, stocks, and bonds, a growing number of investors and advisors have expanded their investment universe to include non-traditional investments, often called “alternatives”. The primary benefit of using non-traditional investments in a portfolio is to augment the risk-adjusted returns provided by a common stock-bond portfolio. This strategy is commonly referred to as taking an “endowment approach” because the endowments of large universities were early adopters of non-traditional investments.

As an example, as of June 30, 2015, Harvard University’s Endowment was valued at $37.6 billion, making it the single largest university endowment. Below outlines Harvard’s asset allocation shifts over the years[1]:

As can be seen in the table above, the percentage allocation to non-traditional investments increased from 25% in 1995 to almost 57% by 2014.

Harvard University Endowment’s annualized performance over the last 10- and 20-year periods ending June 30, 2015 was 7.6% and 11.8%, respectively, as compared to a standard 60% stock / 40% bond portfolio (using the S&P 500 Index and the Barclays Aggregate Bond Index), which provided 6.8% and 7.9% average annualized returns over those same time periods[2].

[1] Source: Harvard Management Company Annual Report 2015.

[2] Source: Harvard 2014 Annual Report.

Building Significance

At Atomi Financial Group, we understand that legacy planning is a very personal matter. We encourage our clients to think very seriously about the short- and long-term implications of creating, communicating, and executing their legacy plans.

When you work with Atomi, your Personal Strategist will spend ample time discussing your situation, needs, and desires to ensure that your intentions and expectations are fully executed. The following is list of the types of questions to consider when creating your legacy plan. When you’re ready to start, we’re here to help.


  • What is the total amount of your estate?

  • Have you thought about the impact of inheritance on your heirs if you were to die tomorrow?

  • What are the goals you wish to accomplish with your estate?
  • What is the personal legacy you want to leave…

    • To your children?

    • To your community?

    • To the Church?

  • What do you hope the inheritance you leave will accomplish for others?

    • Is one of your primary goals to reduce taxes?

    • Is one of your goals to be able to give to charity?

      • If so, how much or what percent of your estate do you think you would like to give to charity?

  • Aside from your children and charity, are there any people or places you would like to leave money (friends, business, education, etc.)?


  • Do you know how much of your estate you would like to leave to your children?

  • Will you divide your estate equally among your children/heirs?

  • Are there special situations, such as a disabled child or relative, that you would like to make special provisions for?

  • Are you confident that your children are prepared to handle the amount of their inheritance?

  • If not today, do you feel they can be trained for that responsibility? What would be required?

  • How important is it to you to see a strong work ethic developed in your children?

  • Will your inheritance optimize or minimize their work ethic? What information/experience do you have that grounds your assessments of this?

  • What problems or conflict do you see arising as a result of your legacy plan?

  • Do you feel obligated to leave the majority of your estate to your children?

  • Do you feel responsible to maximize your estate for the benefit of your children?

  • Do you make spending and investing decisions today with their inheritance in mind?

  • Do you feel that the inheritance you leave them is an indication of your love for them?

  • What would be the worst thing that could happen if your children didn’t receive a significant portion of your estate?

  • Will your grandchildren receive shares of your estate independent from your children?

  • Will you provide restricted or unrestricted gifts to your children and grandchildren?

  • As husband and wife, are you in philosophical agreement on how to disburse your estate?

  • When one of you dies will the other spouse inherit everything or will a portion of the estate be disbursed at that time?

    • If yes, how much and to which parties?  What is the reason for this decision?


  • Describe your business in terms of ownership, assets and your understanding of what will happen in the event that you die.

  • Is your spouse involved in the business? If so, will he/she continue to own and operate the business?

  • If your spouse is not involved in the business, how will they receive income when you die?

  • Are your children involved in the business? Do you intend for them to one day be involved in the business?  What plans are currently underway to support your intentions?

  • Do you have the confidence that your children will be able to effectively run the business?

  • Do you have a documented and communicated succession plan?



  • How do you feel about giving money/assets to charity?

  • What are your philanthropic interests?

  • Do you presently give to charities?

  • If so, approximately how much per year?

  • What giving instruments do you presently use?

  • Are you comfortable with your current level of charitable giving?

  • Do you limit your giving? Why, why not?

  • Does your family understand the full extent of your charitable giving? If no, why not?

  • Is it important for your children to learn charitable giving?

  • Are they currently involved in the giving process? If not, when do you think they should become involved?

  • Do you prefer to give anonymously or to receive recognition for your gifts?

  • Do you understand / are you interested in better understanding biblical principles around charitable giving?

  • If you give significant amounts, are you involved in directing and monitoring the effectiveness of your gifts to ensure they are being applied properly?

  • Do you sit on the boards of any of the organizations that you make charitable donations to?

  • Are you interested in learning more about how you can benefit others and your estate through strategic charitable giving? 



  • Do you currently consider yourself financially independent?

  • What are your feelings about beginning to transfer your wealth while you are still living?

    • To family?

    • To charity?

  • Is it important to pass assets to your heirs in their current form?



  • Have you communicated your intentions to your family / children?

  • Do you think it is important to do so before you (and/or your spouse) die?

  • What is your plan for communicating your legacy plan to:

    • your children

    • your extended family

    • other beneficiaries

  • What questions or struggles do you anticipate as you communicate your legacy plan?

  • Do you desire assistance with this communication process?

  • What resources or assistance do you think your heirs might require as they receive their inheritance?

  • Do you wish to be a part of assisting them in establishing appropriate support to manage their new wealth?

Need more details? Contact us

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