Living Forever :
Baby Boomers and Legacies

Insight Interest Group, June 17th 2008
Introducing Legacy Foresight




• Legacy Monitor - quarterly benchmarking and audit service

• Legacy Forecasting – mediu...
Deaths will grow by a third by 2050
Total number of deaths, 2004 - 2060


   800,000


   750,000


   700,000


   650,00...
This is largely driven by the Baby Boomers
Total deaths and core boomer deaths, 2004 - 2060




             Source : Gove...
So there will be more people dying, but…


• Will they have anything left to leave…?

    • Spending the kids inheritance?...
The Baby Boomer consortium



 • Cancer Research UK         • Help the Aged       • Age Concern England
 • National Trust ...
What do we mean by a ‘Baby Boomer’?




                                        Born         Number born   Age now

  Core...
Formative experiences of British core boomers
The early years : 1945 - 1975




 1944    Education Act - secondary       1...
Shadow Boomers tell a very different story
Formative experiences of British shadow boomers, 1957-87




  1967   Colour TV...
A very different legator profile
Marital status of 65+s, 1971 – 2031




     Males                   1971                ...
In particular , more child-free women
Proportion of women aged 60+ who die with children and with grandchildren
By year of...
Even greater polarisation of wealth
The richest third of boomers account for three quarters of wealth



         Distribu...
Strong evidence of a correlation between past
occupation/education and future wealth, health and
lifestyles

 ‘Second’ nat...
Eagerly anticipating retirement
% agreeing strongly/slightly ‘the best is yet to come’




%




               Source : A...
A growing ‘donor diaspora’
British pensioners overseas, 2010 - 2050




              Source : Brits Abroad, IPPR, 2006
Boomers as consumers


• Confident, experienced consumers – demanding, and willing to
  complain
• Want information and st...
Boomers as legators



• At best, pragmatic idealists – the ‘lucky generation’

• Economic uncertainties and fear of long ...
Conclusions and challenges
Significant growth in the longer term
Total legacy income, 1990 – 2050, £bn 2006 prices
Driven by numbers, not values
Average residual bequest, 1990 – 2050, £000 2006 prices
Charities founded in 1950s and ‘60s will
enjoy the fastest growth



         Religious     Armed services                ...
Five key challenges
How can we…

• Tap into boomers now, as they reach retirement – recognising that
  their expectations ...
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Meg Abdy Legacy Foresight IoF Insight 170608

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Meg Abdy Legacy Foresight IoF Insight 170608

  1. 1. Living Forever : Baby Boomers and Legacies Insight Interest Group, June 17th 2008
  2. 2. Introducing Legacy Foresight • Legacy Monitor - quarterly benchmarking and audit service • Legacy Forecasting – medium/long term for specific charities • Legacy Research – market trends, donor attitudes and motivations
  3. 3. Deaths will grow by a third by 2050 Total number of deaths, 2004 - 2060 800,000 750,000 700,000 650,000 600,000 550,000 500,000 2004 2007 2010 2013 2016 2019 2022 2025 2028 2031 2034 2037 2040 2043 2046 2049 2052 2055 2058 Source : Government Actuaries Department
  4. 4. This is largely driven by the Baby Boomers Total deaths and core boomer deaths, 2004 - 2060 Source : Government Actuaries Department
  5. 5. So there will be more people dying, but… • Will they have anything left to leave…? • Spending the kids inheritance? • Needing long term residential care? • Hit by the pensions crisis? • Impoverished by divorce? • … And will they leave it to charity? • Idealistic or selfish? Craving posterity? • Cynical? Disengaged?
  6. 6. The Baby Boomer consortium • Cancer Research UK • Help the Aged • Age Concern England • National Trust England • PDSA • UNICEF • Oxfam • RSPB • Blue Cross • British Heart Foundation • RNIB • RNID • RNLI • Christian Aid • Diabetes UK • Macmillan Cancer Support • Guide Dogs • CLIC Sargent • NSPCC • WWF UK • Mencap • RSPCA • Childrens Society • Alzheimers Society • Barnardos • NCH • Remember A Charity* • Marie Curie Cancer Care • Cats Protection * Summary report only
  7. 7. What do we mean by a ‘Baby Boomer’? Born Number born Age now Core boomers 1946 - 57 10.2m 49 - 60 Shadow boomers 1958 - 63 5.6m 43 - 48 Baby boomers represented 26% of the UK population in 2004 Source : Office for National Statistics
  8. 8. Formative experiences of British core boomers The early years : 1945 - 1975 1944 Education Act - secondary 1963 Beatles First Album education for all 1964 Biba opens, Top of the Pops 1947 NHS launched 1967 Legalisation of homosexuality 1948 State pension introduced Contraception available from NHS 1951 Listen with Mother launched on ‘social’ grounds 1954 End of rationing Legalisation of abortion 1955 Introduction of commercial TV 1971 Divorce Reform Act 1960 End of National Service 1975 Equal Pay Act Sex Discrimination Act 1961 First man in space
  9. 9. Shadow Boomers tell a very different story Formative experiences of British shadow boomers, 1957-87 1967 Colour TV introduced 1978 SERPS introduced 1972 School leaving age raised to 16 1979 Margaret Thatcher elected 1973 Britain joins the Common 1980 State pension de-indexed Market from earnings 1974 Wilson elected 1982 Unemployment tops 3 million Inflation tops 20% 1984 First AIDs victim diagnosed Comprehensive education 1985 Live Aid introduced 1987 Black Monday 1976 Punk rock breaks
  10. 10. A very different legator profile Marital status of 65+s, 1971 – 2031 Males 1971 1986 2001 2021 2031 Married 73 73 71 67 61 Widowed 19 18 17 13 12 Divorced 1 2 5 12 14 Never married 7 7 7 8 13 Females 1971 1986 2001 2021 2031 Married 35 37 41 48 45 Widowed 50 50 47 33 28 Divorced Source : Office for National Statistics,3 1 5 Government Actuaries Department 14 17 Never married 14 10 7 5 9 Source : Office for National Statistics, Government Actuaries Department
  11. 11. In particular , more child-free women Proportion of women aged 60+ who die with children and with grandchildren By year of death Sources : ONS and Legacy Foresight
  12. 12. Even greater polarisation of wealth The richest third of boomers account for three quarters of wealth Distribution of personal wealth, 45-64s Source : Inland Revenue
  13. 13. Strong evidence of a correlation between past occupation/education and future wealth, health and lifestyles ‘Second’ nation ‘First’ nation Low Terminal Education Age High Lower Occupational level Higher State only Pensions provision Private Rented Housing tenure Home owner Narrow Social networks Wide None Inherited Wealth Some Poor Physical health Good Poor Cognitive function Good Low Morbidity High Low Longevity High
  14. 14. Eagerly anticipating retirement % agreeing strongly/slightly ‘the best is yet to come’ % Source : ACRS 50plusview Panel, Wave 3/05
  15. 15. A growing ‘donor diaspora’ British pensioners overseas, 2010 - 2050 Source : Brits Abroad, IPPR, 2006
  16. 16. Boomers as consumers • Confident, experienced consumers – demanding, and willing to complain • Want information and straight talking – appreciate humour. • See themselves as ‘savvy’ – don’t like to be bombarded or patronised. • Want choice and control – to make up their own minds. Word of mouth is important. • Looking for services that meet their personal needs. • Focus on outcomes and performance – not rhetoric. Do services meet my needs? Am I being treated well? • Desire instant gratification – discount the future in favour of the present • Willing to pay for services, to make their lives easier.
  17. 17. Boomers as legators • At best, pragmatic idealists – the ‘lucky generation’ • Economic uncertainties and fear of long term care restrict spending • For those with kids (especially grandchildren) family comes first ... • ... Not spending the kids inheritance! • Willing to challenge conventions about who ‘should’ inherit • Modest desires for own posterity, but open to marking others’ lives • Want assurance that money will be spent wisely
  18. 18. Conclusions and challenges
  19. 19. Significant growth in the longer term Total legacy income, 1990 – 2050, £bn 2006 prices
  20. 20. Driven by numbers, not values Average residual bequest, 1990 – 2050, £000 2006 prices
  21. 21. Charities founded in 1950s and ‘60s will enjoy the fastest growth Religious Armed services Health Poverty relief & prevention Disability Animals Conservation Arts/culture etc Elderly Children Welfare & housing Education Slow Fast growth growth Source : Legacy Foresight analysis of Caritas database
  22. 22. Five key challenges How can we… • Tap into boomers now, as they reach retirement – recognising that their expectations of volunteering will be very different to past generations • Maintain contact with the ‘donor diaspora’ - helping them through the minefield of international inheritance tax law • Recognise that it’s not one legacy market, but many - segmenting our products and messages according to means and motivations • Develop more sophisticated forms of ‘remembrance’ - targeting spouses, children and friends • Prove the value and effectiveness of our approach – straight talking and cogent arguments are key with this group

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