We are coming to the end of another year of the Legacy Monitor Programme, and what a year it has been. First, I’d like to say a huge thank you to all our Legacy Monitor consortium members, who have done a wonderful job in keeping the data and dialogue flowing throughout these difficult days.

Here, I share my own four top take-outs from this year’s Market Review.

1. Gifts in wills are vital during these uncertain times

In what has been an extraordinary couple of years, the importance of gifts in Wills for UK charities has never been more apparent. When income quickly fell or stopped in many areas, legacy income was resilient, providing charities with a vital income stream when they needed it most.

This period has also demonstrated the need for objective evidence and cross-sector insights for comparison and learning. The Legacy Monitor provides just that; legacy performance data drawn directly from our 80 members’ databases are combined with big picture economic and social trends to create an in-depth analysis of the British legacy sector.

Since our first benchmarking project in 2002, the Legacy Monitor Consortium has grown to 80 charities, representing almost half of all UK legacy income. This year, our members received £1.4bn in legacy income and 53,000 bequests.

2. Managing the bequest surge

Once upon a time, commentaries on demographic and legal trends were predictable, even dull. Not this year. Since spring 2019 the legacy sector has been thrown into turmoil by two huge shocks. First, the ongoing problems at the probate courts (HMCTS), triggered by restructuring, redundancies, and teething problems with new IT systems, leading to a significant slowdown in probate approvals.

Second – tragically – the 2020/21 coronavirus pandemic, leading to over 100,000 UK deaths, and causing severe disruption for all players in the estate management process. The outwash from these two shocks is still being felt today, making it an exceptionally ‘interesting’ time to analyse and predict legacy performance! But keep the faith. Recent data from HMCTS suggest that the problems are starting to unwind.

The challenge for legacy managers is how to deal with the peaks and troughs in workload this situation brings. The short-term volatility is perhaps best managed with extra interim resource (our sister company Legacy Link can help here). In the medium to long term the increasing caseload will accentuate the need for new systems (FirstClass 6 anyone?) and procedures, better training, and the recruitment of a new generation of legacy administration experts.

3. Local causes gaining ground

Once again medium (£1-10m legacy income) and large (£10-25m legacy income) legacy charities report the fastest 5-year growth rates of 6.3% p.a. and 4.7% p.a. respectively. Drilling down in more detail, we continue to see more specialised, often local cause areas gain ground. The fastest growing sub sectors over the past 10 years have been air ambulances (14% p.a.) and wildlife trusts (13% p.a.), followed by arts and education charities, NHS hospitals and mental health charities, all ranging between 7% and 8% p.a.

4. The 10-year outlook remains good

In 2020 the total UK legacy market was worth £3bn. According to our market model, over the next 5 years 2021 – 2025 UK legacy income will total £19.6bn, climbing to £23bn in the 5 years 2026 – 2030. By 2030 UK charities will receive £5bn p.a. in legacy income from 146,000 charitable bequests.

Further ahead, our market projections are still very positive. Thanks to the size, wealth, and lifestyles of the baby boomer generation, we predict that incomes will double in real terms by 2050. That’s a huge positive to focus on over these troubled times.

If you would like to find out more about joining the Legacy Monitor Programme for 2022, please contact Richard Hill.

To access our Legacy Market Briefing 2021 in full, please click here.