How the childless help shape the future

How the childless help shape the future

Who should you leave your money to if you don't have any children? Younger people leave it to their siblings rather than parents - but older people are more likely to opt for nieces and nephews, friends and charities. And some put off what can be a difficult decision and, by default, end up leaving it to the state.

It is a more important issue nationally than it might first appear. Childless people make 55 per cent of all legacies to charities, according to research organisation Legacy Foresight. 'Childless women are the most important group,' says director Meg Abdy. 'If you don't have kids, the emotional commitment to nieces and nephews is much lower.' Childless people are five times more likely to leave money to charities -such as the RSPCA - than those with children.

About £1.6bn a year is going to charities via legacies. Legacy Foresight traces and predicts variations in such giving according to demographics and the growth of personal wealth.

And there are huge variations. At the moment, the proportion of women dying childless is declining. It is about 17 per cent, and will reach 13 per cent in 2025. It peaked at about 25 per cent in the 1970s, when women forced into spinsterhood by First World War deaths were dying in large numbers, and is reducing now as baby boomers get older. Only 11 per cent of women born in 1946 have not had children.

But despite the declining numbers of childless women (who account for 31 per cent of charitable.....continued below

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legacies), legacy receipts are still increasing at 2 per cent per year in real terms. 'People are significantly wealthier,' says Abdy. With the average house price now at the £230,000 mark, homeowners will have a significant sum to leave. And the gay community are playing an important role in the issue. 'The growing number of openly gay baby-boomers and Generation X-ers [those born in the Sixties and Seventies] could mean more money for legacies,' says Abdy.

Lee Penhaligan of solicitor H2O Law has a lot of gay clients in her will-making practice. More people are leaving money to friends, she says, and they are choosing different ways to do it. One couple instructed their executors to invite friends to their house to choose items up to a certain value each. A more common approach is to give sums of cash or items of jewellery. But Penhaligan is seeing more cases of friends getting very large sums - often by being left the 'residuary' estate, the lion's share of the assets once individual legacies have been paid.

What can have a huge effect, of course, is whether the person making the will has a partner. When asked whether people who change partners regularly include their present lover in their will, Penhaligan smiles and says: 'Most people do leave everything to the partner of the moment - and then run back [to change the will] when something goes wrong.'

The wills practice at solicitors Kingsley Napley also regularly sees bequests to friends - such as the man who left £20,000 each to 20 people, including family. Some people find the issue a problem, though. If testators leave money to friends of the same age, beneficiaries can find themselves inheriting at the age of 75 when the attractions of going on a world tour might not be what they were. This is one reason Penhaligan encourages people to make 'lifetime gifts' or to choose heirs who are younger.