Under US tax law, philanthropic foundations are only required to pay out 5% of their assets each year for “charitable purposes”. This means up to 95% of a foundation’s wealth is typically invested in conventional financial markets with the goal of generating financial returns so that the foundation can operate indefinitely without depleting its original pot of money (oftentimes, growing it!). In this model, the 95% is often invested in ways that are disconnected from the foundation’s mission, and may actually undermine its goals.

An alternative to the 5/95 model, in which all of an organization’s resources–financial, people, relationships and lived experiences–are leveraged toward its mission. This can mean investing in ways that advance the foundation’s mission, paying out more than the 5% minimum, or spending down all assets rather than existing forever.  Impact Investing, Integrated Capital, and Trust-Based Philanthropy are all strategies that can work toward 100% Mission Alignment.

New nonprofit organizations/programs seeded by Tara Health that serve as foundational infrastructure for sustained movement building. As part of our spend out and anchor strategy, we are redistributing 100% of our remaining resources to these organizations through our close.

The spend out strategy of redistributing Tara Health’s remaining resources through  its anchor organizations.

The new possibilities emerging as a result of our grantees’ work. A society fully rooted in gender, racial, and economic justice.

A process by which resources or knowledge are taken from marginalized communities without fair compensation, consent, or reciprocity, ultimately benefiting more privileged or powerful groups. Tara Health’s current approach and practices are our efforts to move from extractive philanthropy toward transformative philanthropy and a Just Transition.

Investing that centers justice as a core investment principle. With our impact investing, Tara Health envisions a world where finance exists to serve people, instead of the other way around. Our strategies  include public equities, private equity, and shareholder advocacy. Impact Investing is a key strategy for achieving 100% Mission Alignment.

A practice of deploying different types of capital(money) in coordinated ways to meet the specific funding needs of a partner or project. Our strategies include offering and blending grants, low-interest loans, equity, and more in a coordinated fashion, in order to support our mission.  Integrated Capital is a strategy that supports 100% Mission Alignment.

A vision of the future that sees resources and power justly distributed, so that all people can assert sovereignty over their bodies and futures. Tara Health believes abundance emerges when wealth is circulated rather than accumulated — making spend out philanthropy a practice of bringing this vision to life.

Also referred to as “spend down”, “sunsetting” or “limited life”, a practice of spending all of the foundation’s assets and closing the organization within a defined timeframe, rather than existing in perpetuity. While often framed as inherently progressive, spending down is a tactic — one that requires intentional strategy to truly build movement power and fundamentally transform philanthropy’s role in perpetuating inequality.

A philanthropic practice that centers relationships, shared humanity, and connection as a way to alleviate the inherent power imbalances between funders, nonprofits, and communities. It requires honest conversations, accountability, and a willingness to be transformed. Trust-based philanthropy is a strategy that supports 100% Mission Alignment.