Once again, we have updated our projections of the impact of COVID-19 on the UK legacy market, to take account of the very latest available economic, demographic and administrative information.

This time around, in addition to the optimistic and pessimistic scenarios, we have introduced a new central scenario, which represents our ‘best estimate’ for the path of legacy income over the next five years.

Our latest forecasts suggest cash legacy income could shrink by between 1% and 15% in 2020, with a central estimate of 8%. These projections are more optimistic than those produced in May and June, primarily thanks to legacy administration teams ‘ apparent resilience during lockdown.

Jon Franklin, economist at Legacy Foresight, says, “Analysis from the Legacy Monitor showed cash income remained buoyant, thanks to legacy administration teams’ speed to adapt during lockdown; this is reflected in our more optimistic outlook for legacy income over the rest of the year.

He continues: “As delays unwind and income starts to flow from an anticipated increase in bequests, it is likely that income could rise quite rapidly in 2021 and 2022.”

Due to the gloomier economic outlook in the aftermath of the pandemic, the pace of recovery after 2020 is likely to be slower than we previously anticipated. However, over the medium-term legacy income is still expected to grow – increasing from £3.4bn in 2019 to £3.5bn-£3.9bn in 2024, with a central estimate of a 9% increase.

These forecasts reinforce yet again the importance of gifts in wills, at a time when many other sources of income are falling.

Many of our regular clients tell us how vital our income forecasts are at the moment. Given how fundamental legacy income is for many charities, it’s critical to project – and plan for – the impact of COVID-19, both now and over the next three years. If we can help with your forecasts, please get in touch with Jon Franklin or Tim Yates.