Focusing on encouraging will donations
Motivating people to give to a charity when the cause has not directly affected them or their loved ones is one of the biggest challenges that charities have to face, and figuring out how to do it is always at the heart of a charity's work. But getting people to give to your charity isn't just a competition against other charities whose goals are similar to yours - you're also competing against all the other demands on an individual's attention, time and finances.
Fall in number of people giving
Despite Britons being famously charitable at times of crisis - notably in overseas aid efforts, such as tsunami appeals, international conflicts and other flashpoints of human emergency heavily covered in the media - the financial climate of recent years has made bringing in donors that bit more difficult for charities. Thus there was little surprise when a survey carried out by UK Giving in 2012 revealed a general fall in the number of people giving to charity.
Indeed, the survey went on to highlight that many people don't actively plan to give to charity; a large percentage of donors are merely responsive to events when contributing to a cause.
Yet as the country continues to climb out of recession - and hopes for greater donor activity may come true - new data published last month by my own organisations has shed some light on donations made after people pass away. While charities perhaps rightfully avoid directly targeting people to contribute to their cause through a will, it still accounts for large chunks of funding to keep their operations continuing.
Attitudes to legacies
My firm commissioned a YouGov poll of 2,064 people which revealed that six in ten people don't believe it's important to leave a donation to charity in their will; only a quarter of those surveyed said that they are planning to support a charity as part of their last wishes.
Obviously, a quarter is still a relatively high proportion, though as data from the campaigning group Remember a Charity has revealed – and as many charity managers know all too well – there is a big difference between intention and action. According to the group, only 7% of people actually do leave something to a good cause in their will. This issue is further exacerbated by the high number of people who don't arrange a will at all.
The low number of people choosing to leave behind a charitable donation could be seen as tying in with another finding of the survey: people seem to become less likely to leave money to charity as they get older. According to the survey, one third of full-time students said they planned to leave money to charity in their will, compared to just 22% of retirees.
It's possible that younger people see will-giving as an ideal for the distant future, while retirees recognise their own mortality as a more immediate concern and prefer to prioritise covering medical costs, or leaving money to support family members when they pass away.
So why are legacies so important? After all, many charities get plenty of support from one-off donations from businesses and events, as well as smaller, regular donations from individuals. However, the advantage of will donations is that they tend to be larger than the amount someone would give during their life. Once any debts and inheritance funds have been dealt with, there's nothing left for the individual to save towards, so they can give more generously.
Personal connection is biggest motivator
Understanding why people choose to leave money to charity in their will could go some way to helping charities harness the power of will donations. According to the survey, 58% of people want to support a cause they have a personal association with, while a similar proportion (56%) said they wanted to help others. Interestingly, only 5% said they would do it for tax reasons, even though charitable donations can considerably reduce an inheritance tax bill.
Of those who said they are planning to leave a donation to charity in their will, cancer charities were the most popular cause to support, with 45% of people choosing these. For 29%, animal welfare was an important choice, followed by charities working with other terminal and degenerative diseases (26%), child welfare (23%) and mental health (20%).
Further data from the survey confirmed the importance of a personal connection in people's charitable preferences. The poll revealed that people with children are more likely to support child welfare charities over animal welfare, while retired people show the strongest preference for cancer charities. It was also discovered that women are almost twice as likely to support animal welfare charities compared to men, and that London is the region where people are most likely to support a charity in their will.
Charities should promote will-giving more
Charities around the country depend on donations from their supporters to carry out their work, and some of the most generous contributions are often left in wills. However, the data in the survey, combined with previous research, suggests that more could be done to encourage people to remember a charity when they're drawing up their last requests. Given the tax benefits of leaving money to charity, there are a lot of good reasons to consider this route when planning a will.
Charity managers should perhaps be giving more consideration to how they can make people more aware of the tax benefits of leaving money to charity, especially as only 5% of those surveyed said that it would be a consideration. This could be down to them having other motivations, or it could be because not many people know about the tax benefits of leaving money to charity. Either way, it is something that charities could potentially leverage in their marketing strategies.
