Generation impact: one in eight wants to use inheritance for good

One in eight (12%) people under-45 who expect to receive an inheritance intend to gift some of the money to a charity or cause close to their hearts, according to research from Sanlam UK.

The report, The Generation Game, found that 5.1 million people are likely to receive an inheritance over £50,000. With the mean average value of the inheritance expected to be £233,000, millions of pounds are expected to be gifted to charity over the next 30 years.

Not only are this younger generation considering gifting part of their inheritance, under-45s are embracing other ethically based financial options such as socially responsible investing (26%), impact investing (15%) and venture philanthropy (10%). The corresponding figures for the over-55s surveyed are 20%, 5% and 6% respectively.

The findings also revealed that 88% of under-45s believe it is important that their wealth is not invested in something that contravenes their beliefs, compared to 80% of over-55s.

Summary of the report’s findings:

Top ways in which people think they can put their money to good use for a positive social and environmental impact: Under 45s Over 55s
Venture philanthropy 10% 6%
Socially responsible investing 26% 20%
Impact investing 15% 5%
Putting your pension into an ethical fund 20% 16%
Using shareholding in a company to try to influence its activities 16% 12%
By not investing in a company whose business or conduct I disagree with 23% 23%
By not buying products/services from companies who have a harmful effect on society or the environment 26% 28%
Buying ethically-sourced goods 27% 21%
Giving to Non-governmental organisations or charities that campaign on these issues 22% 19%
Paying tax 23% 24%

Carl Drummond, senior wealth planner at Sanlam UK said: “The findings of our survey highlight a trend that has been much discussed, the fact that younger generations increasingly want to use their wealth for good. But it’s not only so-called ‘Generation Impact’ who are attracted to more ethical ways of investing their money, those in the over-55 age group also indicate a strong awareness of how their money is invested – indeed, 28% reported that their wealth could be used for good by not investing in companies whose products or services have a harmful effect on society or the environment. 

“This is a challenge for the industry. Defining what is and what isn’t ethical is a minefield but as our report shows, appetite for these types of products and services is not going to go away. As people of all ages become more connected with their money and have greater visibility around how it is invested, those advising them will need to balance how to meet their desired financial returns with their moral ideals.” 

Report methodology

The figures in this release are taken from three separate sets of research undertaken for Sanlam UK’s Generation Game report in April 2018. These comprise:

  • An online survey carried out by Atomik research of 1,000 people aged between 25 and 45, who are expecting to receive inheritance of at least £50,000 (in fixed assets or money) from their parents and/or grandparents.
  • An online survey also carried out by Atomik research of 500 over-55s, with investable assets of £100k+, who are leaving an inheritance to their children or grandchildren.
  • An online survey of 200 IFAs carried out by Opinium.

In addition, more than 100 face-to-face interviews with intermediaries, lawyers, accountants and family offices were conducted by Sanlam UK and helped inform the content of the report.

NB: All statistics used, unless stated otherwise, are taken from these sources, and all mentions of under-45s and over-55s in this report and release refer to the aforementioned samples

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