Legacies ‘to reach record levels’ in 2021

Legacy giving to charities is expected to reach record levels in 2021, according to latest research.

An increase in the death rate this year amid the Covid-19 pandemic is set to see a significant spike in charitable bequests in 2021.

A clearing of a backlog in processing wills amid the health crisis will further drive the boost in bequests next year.

Research by Legacy Foresight suggests that the number of bequests could increase by between 37% and 50% compared to 2020.

The research organisations says that the increase in deaths in 2020 is a key factor, The death rate could reach between 687,000 and 695,000 – the highest level for more than 100 years.

Administrative delays is “ongoing”, according to Legacy Foresight “which in turn is impacting bequests received by charities”, however, the government is taking action to speed up this process and it is hoped the backlog will clear next year.

Between January and September the number of bequests received by charities reduced by 20%.

Legacy Foresight economist Jon Franklin said: “The single biggest source of uncertainty for legacy incomes at the moment is not so much the impact of the pandemic but the impact of administrative delays at probate.

“If the backlog at probate is cleared, then we could see the demands on legacy administration teams peak at record levels next year, and charities need to think about how they can respond to that at relatively short notice.”

“Further ahead, the outlook remains positive, with growth in both income and bequests expected over the coming five years.”

The five-year outlook for legacy incomes looks positive, Legacy Foresight added. It predicts legacy incomes will reach between £3.6bn and £4bn by 2025, an increase of between 6% and 16% on 2019’s figures. Furthermore, it expects to see 10% more charity bequests between 2020 and 2025, compared to 2014 and 2019.

Rob Cope, director of the group Remember A Charity, added: “If there was ever a year when charities were in need of a record number of charitable bequests, then surely 2021 will be it. This forecast for a boost in legacy growth over the next few years could not be more welcome or more needed.”

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