Charity Through Wealth: Legacy Giving and Philanthropy

Philanthropy has evolved into a dynamic force shaping communities, empowering nonprofits, and transforming lives globally. Among its many forms, legacy giving through wills and estates stands out as a cornerstone of sustainable funding, ensuring that a donor’s values endure long after their lifetime.

Present-Day Philanthropy: By the Numbers

In 2024, total U.S. charitable giving reached a record-high $592.5 billion. Individuals led the charge, contributing $392.5 billion (66%), while foundations and corporations added $109.8 billion (19%) and $44.4 billion (7%) respectively. Legacy gifts, or bequests, accounted for $45.8 billion—about 8% of the total.

Across the Atlantic, U.K. charities received 145,000 bequests in 2024, generating billions in support. On average, legacy gifts comprised 30% of fundraised income for the top 1,000 charities and climbed to 50% in niche sectors like animal welfare and disability services.

This robust financial landscape reflects both broad-based generosity and the growing influence of wealth-based philanthropy. Despite a slight nominal decline in U.S. legacy giving in 2024 (down 1.6%, or 4.4% in real terms), bequests remain a vital revenue source for large organizations and community-driven initiatives alike.

Internationally, secular causes such as education, health, and environmental groups are increasingly capturing legacy dollars, compensating for a steady decline in religious giving. In the U.S., religious institutions received $146.5 billion in 2024—still significant, but reduced from 56% of total donations in the late 1980s to 25% today.

The Legacy Giving Landscape: Who Gives and How Much?

Affluent individuals are the primary drivers of legacy gifts. In the U.K., estates leaving a charitable bequest average £559,000 in value, compared to £394,000 for non-charitable estates. Meanwhile, in the U.S., 81% of affluent Americans made charitable contributions in 2024, with an average gift exceeding $33,000—more than ten times the general population’s average donation.

However, only 7% of U.S. estate planners cite charitable giving as a principal motivator. This mismatch highlights a profound opportunity: by integrating philanthropy into legal and financial planning conversations, charities can tap into locked potential and secure future legacies.

House price inflation and evolving inheritance tax policies also play a role. As property values soar, so do estate valuations, often triggering tax planning considerations that include charitable deductions. In regions where inheritance tax exemptions are generous, planned giving strategies flourish.

Why We Give: Motivations and Barriers

Understanding donor motivations is critical for securing both immediate contributions and long-term legacies. Key drivers include:

• A personal connection to a cause such as education, health research, or environmental protection.
• Desire to leave a meaningful impact and carry forward one’s values for generations.
• Tax incentives and estate planning benefits that enhance financial outcomes for heirs and charities.

Nevertheless, significant barriers can impede legacy giving. Only 24% of Americans currently have a valid will, down from 33% three years ago. Without formal estate plans, potential benefactors may unintentionally exclude charitable gifts, causing nonprofits to miss out on vital funding.

Moreover, the emotional complexity of end-of-life decisions can deter conversation. Donors often need reassurance that their beneficiaries and charitable causes will both be honored. Addressing these concerns requires transparent communication and expert guidance.

Impact on Nonprofits: Sector Insights

Legacy gifts offer nonprofits a reliable source of funding that can be strategically allocated to endowments, capital projects, and long-term programs. Certain sectors benefit disproportionately from planned gifts:

• Animal welfare and conservation organizations, where legacies can account for up to 50% of fundraised income.
• Disability services and social justice nonprofits, which rely on multi-year endowments for program continuity.

Education and health institutions also leverage bequests to establish scholarships, research grants, and facility upgrades. For example, the United Negro College Fund (UNCF) receives between $7 million and $12 million annually from legacy contributions, supporting scholarship programs and institutional growth.

Public-society benefit charities—ranging from legal aid to international relief—are among the fastest-growing recipients of planned gifts. As global challenges intensify, these organizations rely on legacy funding to maintain agility and impact.

Economic, Tax, and Policy Drivers

External factors significantly shape the volume and velocity of legacy giving. A buoyant stock market and consistent GDP growth have historically correlated with higher philanthropic outflows, including planned gifts. Conversely, market downturns can erode estate values, reducing bequest potential.

Tax policy is equally influential. Estate tax thresholds, charitable deduction caps, and itemized deduction rules determine the viability of various planned giving vehicles. In jurisdictions where high-net-worth individuals can leverage tax incentives, charities often see elevated levels of legacy commitments.

Nonprofit leaders must stay attuned to legislative changes. When governments propose alterations to estate or inheritance taxes, organizations should proactively inform their donor base about new opportunities and ensure compliance with evolving legal frameworks.

Trends Shaping the Future

The philanthropic landscape is being transformed by a generational shift and digital innovation. The “Great Wealth Transfer”—an estimated $124 trillion passing from Baby Boomers to Gen X, Millennials, and Generation Z over the next quarter-century—will redefine donor demographics and preferences.

Younger donors exhibit unique priorities: they expect digital-first engagement, demand transparent impact metrics, and seek social justice-focused causes. Millennial charitable participation rose 16% since 2021, and Gen Z giving increased by 22% over the same period.

Donor-advised funds (DAFs) and digital platforms are also gaining traction as flexible giving vehicles. These tools allow donors to manage contributions in real-time while promising a streamlined legacy component for inclusion in estate plans.

How Nonprofits Can Adapt and Lead

As the donor profile evolves, charities must adopt integrated fundraising strategies that blend immediate giving with planned gifts:

• Implement multi-channel campaigns combining email, social media, and personal outreach to showcase legacy opportunities.
• Host informational webinars and workshops on estate planning, collaborating with legal and financial advisors.
• Provide tailored stewardship experiences, ensuring donors witness the long-term impact of their gifts.
• Offer flexible giving vehicles, such as charitable remainder trusts, donor-advised funds, and legacy societies.

By building trust, sharing compelling stories, and demonstrating transparent stewardship, organizations can cultivate meaningful relationships that endure beyond a single gift.

Future Outlook: Opportunities and Challenges

Looking ahead, projections indicate that U.K. legacy giving will more than double by 2050, reaching £10.5 billion in real terms. In the U.S., the maturation of the wealth transfer and heightened estate planning awareness point toward increasing legacy gift volumes.

Yet, nonprofits face pressing challenges: declining will ownership among the general population, fluctuating tax incentives, and the imperative to engage younger generations with diverse philanthropic interests. Scenario planning and forecasting will be essential in navigating these uncertainties.

Organizations that invest in donor education, digital infrastructure, and impact reporting will be best positioned to capture the next wave of legacy commitments. By cultivating a culture of philanthropy, charities can inspire supporters to embed generosity in their life stories.

Conclusion

Legacy giving represents more than a financial transaction. It is a profound expression of values and a commitment to future generations, bridging the donor’s life mission with the enduring work of nonprofits.

By understanding the statistical landscape, motivational factors, and sector-specific dynamics, charities can craft targeted strategies that resonate with affluents and emerging philanthropists alike. As wealth shifts and societal needs evolve, legacy gifts will remain an indispensable pillar of the philanthropic ecosystem.

For donors and nonprofits alike, the path forward is clear: embrace innovation, foster genuine relationships, and ensure that generosity transcends time—building a legacy that shapes the world for decades to come.