In the realm of charitable fundraising, a significant shift is underway. According to Smee & Ford, there has been an eight per cent increase in legacy funding over the past year, largely attributed to rising house prices.
This trend, coupled with predictions that annual legacy income for charities is set to double by 2050, positions legacy giving – where donors leave charitable bequests in their Wills – as a crucial revenue stream for charities.
Why charities need to focus on legacy funding
There are several reasons why legacy funding is important:
- Sustainable revenue source: Legacy gifts, often substantial due to assets like property, provide a more predictable and stable income compared to traditional fundraising methods.
- Demographic shifts: With an ageing population, particularly among the baby boomer generation, the potential for legacy giving is increasing.
- Long-term impact: Legacy gifts ensure ongoing support, enabling charities to plan future initiatives with greater certainty.
Steps to increase legacy income
Here are some methods of improving income from legacy funding:
- Raise awareness: Many potential donors are not aware of legacy giving options. Charities should actively promote this through campaigns and informative materials, highlighting recent trends like the impact of rising house prices on legacy giving.
- Simplify the process: Providing clear guidelines and possibly partnering with legal professionals can make the process of leaving a legacy gift straightforward for donors.
- Build relationships: Strong relationships with current supporters can pave the way for legacy-giving considerations. Showcasing the impact of current donations encourages this long-term commitment.
- Tailor communication: Effective communication that aligns with the values of potential legacy donors is key. Understanding their motivations is crucial in outreach efforts.
- Training staff: Staff and volunteers need to be well-versed in the nuances of legacy giving, and equipped to handle sensitive conversations around this topic.
- Legacy stewardship programs: Recognising legacy donors through stewardship programs keeps them connected to the charity’s work, reinforcing their decision to leave a legacy.
- Showcase impact: Demonstrating the tangible impact of legacy gifts through success stories and testimonials can inspire potential donors.
- Legal and financial advice: Offering advice on Inheritance Tax benefits and other financial aspects of legacy giving, either directly or through your advisor, can be a valuable service to donors.
The recent surge in legacy income, driven in part by factors like rising house prices, signals a pivotal shift in charitable giving.
Charities must adapt to this change and invest more in securing legacy funding. By implementing strategic measures to encourage this form of giving, charities can ensure their enduring impact and financial stability well into the future.
