GP Commitment Funding Calculator
Model your capital call schedule, financing costs, and break-even fund return. Built for PE partners and principals who need to fund a GP commitment without disrupting personal liquidity.
The funding problem. A 2% GP commitment on a $300M fund is $6M — called over 5–7 years in irregular tranches. Most PE professionals don't hold $6M in cash. The question is: how much do you finance, at what cost, and does the fund math still work?
Your four funding options
Most PE professionals use a mix. Understanding the cost of each helps you decide how much credit to maintain and where.
| Option | Typical cost | Pros | Cons |
|---|---|---|---|
| Personal cash | 0% (opportunity cost only) | No interest, no margin call risk | Ties up liquidity; most PE partners can't fund $5M+ in cash |
| Margin on brokerage | 6–9% currently (SOFR-linked) | Fastest, most flexible; available at most major brokerages | Market-risk correlated — margin calls tend to coincide with bad markets |
| Firm subscription credit line | SOFR + 1–3% (often cheapest) | Lowest rate when available; firm handles the mechanics | Not always offered; availability varies by fund; may have GP contribution caps |
| HELOC / personal LOC | Prime + 0.5–2% (currently ~8–10%) | No portfolio correlation risk; no margin call | Slower to set up; home equity at risk; higher rate than subscription line |
Rule of thumb. Keep 2–3× your next year's expected capital calls in readily available credit (not just liquid assets). Capital calls often come in clusters — fund managers draw when deals close, not on a calendar. A $5M total commitment over 5 years averages $1M/year, but you might see $1.8M in year one and $400K in year two. Size your facility for the spike, not the average.
What a specialist models that this calculator doesn't
- Tax drag on financing: Margin interest deductibility (Form 4952) reduces the after-tax cost — but only to the extent of your net investment income. How much that's worth depends on your full picture.
- Cross-fund sequencing: If you're in Fund III and about to close Fund IV, both commitment schedules overlap. The cash flow crunch is often year 2–3 when two funds are calling simultaneously.
- Carry distribution timing: Distributions from Fund II may partially self-fund your Fund IV commitment — if the timing lines up. A specialist models the overlap, not just one fund in isolation.
- Portfolio concentration risk: Pledging a concentrated brokerage position for margin creates correlated exposure. If your liquid portfolio is mostly your firm's publicly-traded peer, a downturn hits both the margin collateral and the fund's portfolio at the same time.
- Credit facility sizing: Most advisors recommend 2–3× the expected next-year call in undrawn credit, not drawn. This models out the facility structure across fund vintage.
Related reading
Model your actual commitment
A specialist advisor runs the full picture: GP commitment across vintages, carry timing, deferred comp, and QSBS. Fee-only, no commission. Free match.