New forecasts suggest more dramatic decline in legacy incomes this year

Melanie May | 28 April 2020 | News

Legacy incomes could shrink between 8% and 27%, in 2020 by but will bounce back significantly from 2021 onwards, according to Legacy Foresight’s latest projections.
Legacy Foresight has updated its projections of the impact of the coronavirus on UK legacy incomes to take account of the latest available economic, demographic and administrative evidence.
All these factors have deteriorated since the last forecasts were produced at the end of March, with economic commentators generally more pessimistic than a month ago, a higher number of UK deaths than previously predicted, and the impact on solicitors, charities and government departments capacity to process charitable bequests more severe than previously assumed.
This suggests that there will be a more dramatic decline in legacy incomes over the coming year. However, the negative impact is expected to be relatively short-lived, and Legacy Foresight’s forecasts for the next five years continue to suggest market growth, with legacy incomes ending the five years 13% to 18% up on 2019 levels.
As in March, two alternative five-year scenarios for the UK legacy market have been developed. One is a relatively optimistic scenario, which assumes that the government’s Covid-19 response is more successful with the second more pessimistic.

Key findings

Jon Franklin, Economist at Legacy Foresight, commented:

“These forecasts show a more dramatic decline in legacy income, especially over the coming year. But despite the enormous uncertainty and significant negative impact in the short term, it’s important to recognise that legacy incomes are still expected to grow over the next five years.”

 

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