Date published: 01 March 2016 by Digital Team
Remembering a charity in your will is a particularly meaningful gesture, which ensures that your influence continues, supporting those causes most important to you during your lifetime.
A pecuniary (named) bequest to an individual or charity does not change in amount, but will certainly change in value as time passes. For instance £1,000 bequeathed in 1991 would only carry half of the purchasing power today as it did then.
Residuary bequests represent a percentage share of a person’s estate, meaning that as the estate value changes, so too does a residuary bequest, by the same proportion.
Pecuniary gifts account for over half of all charitable bequests, however the average value of a residuary (percentage) legacy donation is 15 times that of a pecuniary legacy donation, giving it increased financial value to the beneficiary.
This is, in part, due the rapid and sustained rise in house prices over recent years, which has had a significant impact upon the value of a person’s estate. In the fourth quarter of 2014 alone, average UK house prices rose by an astounding 10 per cent. Of course this has also led to an increase in the number of estates which are liable for inheritance tax payments (see below for more information on how you can reduce your inheritance tax burden).
The upshot is that over time, a meaningful gesture can lose impact as costs continue to rise– a will written twenty years ago is always worth revisiting as understandably, priorities change, families grow and assets may rise or fall in value.
Contact Jenny-Anne Dexter, Individual Giving Officer at Rainbow Trust:
You can contact The Law Society to find a local, independent solicitor at:
www.solicitors.lawsociety.org.uk
Read our FAQs on how to support Rainbow Trust in your will:
