2022 – make this the year your leaders really understand the simplicity of raising a fortune through legacies
And do your prospects realise they can be part of the solution?
Richard Radcliffe FCIoF Cert. Founder Radcliffe Consulting.
| Feel free to email me: richard@radcliffeconsulting.org and I will send a copy of this blog for you to pass onto your Trustees and leadership team |
Legacy giving involves a legal document: a Will. Charities do not usually have legally qualified staff. So, is there a lack of clarity about what charities are meant to say and do?
Legacy giving campaigns are often delayed for a number of reasons.
In my experience, leaders of the majority of charities regard the idea as far more complicated than a donation campaign. This is so wrong.
And is there a worry about fundraisers having to have knowledge of the legal framework? BTW the answer is NO!
A summary of key facts
Income from charitable legacies has doubled in less than 15 years to over £3 billion annually
Legacy income is due to double again in the next two decades
Twice as many charities are benefitting from legacies than 15 years ago.
(Source of the above information: Smee & Ford Ltd. A company which reads all Wills in England Wales and Scotland after probate has been granted. I ran Smee & Ford for over a decade, and it transformed my whole thinking)
The average legacy is worth around £25,000 – equivalent to a donor giving £5 per month for 416 years.
The legal environment
A charity raises money to benefit its beneficiaries. The charity is only the conduit to fulfil activities for public benefit.
The Charity Commission of England and Wales clearly expresses the Duties of a Trustee in relation to fundraising (CC20 leaflet) but sadly gives no guidance on the importance of legacy income. The CC20 leaflet clearly states the responsibility of protecting the charity’s reputation, money and assets. For legacies this will mean making sure you receive what you are due in a Will. A legacy campaign must not harm your charity’s reputation and that money used to invest in a legacy campaign must be justified. Do not be put off – investment can be minimal or even £0.
The Fundraising Regulator clearly expresses the parameters of legacy fundraising (Code of Practice, Section 15).
This includes: “You must make it clear that the contents of any [legacy] communications are not intended to be legal advice from you and that potential testators should get their own professional advice”
It is also made clear that “there are considerable risks to you (the charity) in paying for the costs involved in making a Will” ……. So, it is discouraged. But it states parameters which make it acceptable. It is the decision of your trustees as to whether you offer (or invest in) the benefit of a discounted or free Will – but it is certainly NOT the most important element to a simple and beneficial campaign.
What about legacy administration? In other words when you receive a legacy. In brief, you have to “optimise legacy income”. Advice can be gained from The Institute of Legacy Management on how this can be ensured within best practice. And this only really applies when a charity is left a % of an estate. A cash sum involves little action apart from gaining the cash.
So, the only role involving any form of “legal knowledge/awareness” can be when you are notified of a legacy. Often a “lead charity” (with suitably qualified staff) can help all those charities in the same Will. And 2 out of 3 Wills have more than one charity as a beneficiary so you might have to do little (if anything) to receive what you are due.
What about tax benefits? Charities are NOT wealth advisers, so you need say little except: “for every £1000 you leave us you are likely to save £400 inheritance tax, but please take professional advice”.
In ALL CASES you refer your prospect to take their own legal advice, what could be simpler?
Your role as a charity is to inspire prospects about your work and signpost prospects to their professional adviser. Not to take part in the legal process.
Key issues
You can, should and must promote the opportunity to give legacies. By doing so you are giving every stakeholder/prospect the freedom to give as each one wants to. And about 1 in 3 of those aged over 55 want to leave a legacy but they might not realise you need them.
At times of financial uncertainty, a legacy is often the preferred method of giving to charity because it does not affect the bank balance now.
A legacy is nothing to do with death: it is a way of fulfilling a philanthropic dream.
A Will is nothing to do with death. It is giving each testator a fabulous chance to secure the future of those following in their footsteps.
So, is it wise, as a trustee or management leader, to plan for the future financial health of your charity? Yes, especially because most legacies are given for unrestricted purposes. They are the vaccine for future financial health. The barrier is the “lack of urgency” due to the funds coming to the charity after the leaders have gone. Your leaders should be focused on the long term not just FUNDS NOW. They should be viewed as visionaries.
Promoting the benefits of legacies and ease of action
This is all you need do:
- Draft a long-term vision so that prospects know the impact their gift can have. Put it on your website. Also, say it at events.
- Draft simple statements which remind your many target audiences that they are able to leave a legacy because their gift can be whatever is affordable for them.
- Include your charity registration number and name – that is all a prospect needs for their Will/professional adviser – apart from the size/type of their gift.
Legacy giving is simple
Making and changing a Will is easy and reputable sources of free Wills are easily available if you are determined to make such an offer. Though please note the best prospects will already have a Will – but they might need to update it.
Our experience ranges from developing two-page action plans to large global strategies based on knowledge in over 30 countries. Our plans, regardless of size, are incredibly practical, down to earth and tailored to meet the resources, or lack of them, currently available.
Our overheads are minimal which is why we are such a goof value (based on 35 years’ experience).
The role of a charity
A legacy campaign is surprisingly easy. You have to inspire action. You have to prove that legacies secure the future financial health of the charity and provide more solutions for generations to come.
It is as simple as that. And once you get going there is so much more you can do to engage and achieve incredible results.
Richard Radcliffe FCIoF Cert.
Richard has 35 years’ experience of promoting legacy giving. His mission is to ensure that all communications about legacy giving are positive, acceptable to all audiences and upbeat, He has worked with around 500 charities, He holds focus groups, drafts strategies and trains anyone “to ask nicely” for legacies without any pressure. His strategies involve no risk and minimal expenditure. Richard has chaired the Annual Convention of The Chartered Institute of Fundraising (CIOF) and the International Fundraising Congress. In 2018 he received the Lifetime Achievement to Fundraising Award from the CIOF. His book “Why legacies are brilliant for charities and how to get them” has been sold around the world.
Sources mentioned:
www.gov.uk/government/organisations/charity-commission