ABSTRACT
With special thanks to Meg Abdy (Legacy Foresight), Emma Bockhop (Remember A Charity) and Kevin Kibble (Whitewater) for supplying text and other resources for this chapter.
INTRODUCTION
Legacy Foresight estimate that the UK legacy market is now worth £1.9 billion. Over the past 24 years, the market has grown eight-fold in ‘money of the day’ terms. Even after accounting for infl ation, it has more than trebled. It currently provides around 13 per cent of overall voluntary income, although this is only an average fi gure and charities such as the RNLI and RSPCA regularly derive over two-thirds of their income from this source (Legacy Foresight 2008). A key characteristic of this income stream that makes it so critical for many organizations is the fact that legacies are usually ‘unrestricted’ so that they can use the money as they wish. Legacies also have the merit of being comparatively cheap to raise. The charities that comprise
the legacy foresight consortium currently spend only around 2 per cent of their legacy income on this category of fundraising. The work of the consortium is described below:
Legacy gifts may be either pecuniary or residuary. Pecuniary gifts are gifts of specifi c sums, while residuary gifts are gifts of a percentage of the balance (or residue) of the estate after specifi c legacies (e.g. to family) and any debts have been paid. They are very different in terms of value to a nonprofi t since pecuniary gifts, however generous they might be at the time a will is written, will inevitably decline in value over time. A £1,000 donation is worth a lot less today than it would have been 20 years ago! Individual estates are also typically worth a lot more when the assets are realized than the donor might have envisaged when the will was originally drafted. The value of the estate will have increased over time. For both these reasons the average value of a pecuniary donation is £3K, while the average value of a residuary gift is £50K.
