Credit Crunch Drives Down Will Legacies in Scotland
Monday, November 23rd, 2009
on behalf of Gibson Kerr Solicitors
The credit crunch is putting charities across Scotland in danger from losing out on vital revenue, due to people leaving smaller donations in their wills and legacies.
Scottish legal firm Gibson Kerr believes that many charities across the country are likely to receive less money from legacies over the coming years – as more people in Scotland choose to dramatically cut down donations after reassessing their personal wealth in the wake of the economic downturn.
The firm says that with investments, such as share portfolios, savings and property, falling in value, many people will choose to change their wills to ensure family members are not left out of pocket in favour of charities.
Edinburgh-based Gibson Kerr believes that many charities that rely on vital funding from donations left in wills could be seriously hindered in the future – as more and more legacy donations are reduced in people’s wills.
Fiona Rasmusen, partner at Gibson Kerr, said: “We all know the credit crunch has had a huge effect on many people in Scotland and the rest of the UK.
Edinburgh experts in will making
“Many people have investments in savings accounts, shares and property, but these have been badly hit by the economic downturn. It seems likely that people will opt to change the details of their wills to reflect these difficult conditions.
“With savings and investments worth far less than they used to be, people may decide to leave more money to their families and loved ones – and less to external organisations.
“It would appear that there is a desire to avoid any upset in a family by ensuring donations to loved ones does not reduce as a result of the credit crunch.
“The idea is that, if you have a property or share portfolio that is worth £50,000 less than it was a few years ago, you will want to ensure that your family doesn’t lose out as a result of this.
“Therefore, you’ll look to amend other parts of your will and will give money that would have originally gone to a charity to your family instead.
Scotland’s legal experts
“In some cases, that will mean a will that was perhaps split 70:30 – family donations v charitable donations – is now being changed to 80:20 or even 90:10.
“Charities are likely to suffer from this further down the line. Just a few years ago, you would get people leaving fairly large donation to an organisation such as the Scottish SPCA or Cancer Research in their will, but now these legacies might become much rarer.”
Fiona believes that, until the economy recovers and confidence returns, charitable organisations are likely to face lean times in terms of the will legacies left to them.
Gibson Kerr is a family-run law firm that has been established in Edinburgh for more than 100 years. It has an excellent reputation for providing a comprehensive service encompassing both property and personal law, including powers of attorney, executries and wills.