Charities must begin building new relationships with today’s rich retired people because they have changing expectations, according to a new paper from the Commission on the Voluntary Sector & Ageing.
The paper, A Better Ask, recommends that charities start tailoring their fundraising plans to meet the changing expectations of a new generation of donors.
It was produced following round-table discussions held between the commission and fundraisers, donors and charity experts this summer.
The commission was set up last year to examine and prepare for the challenges and opportunities presented by an ageing population.
According to the paper, the "deferential model" of giving is over. Today’s retirees are the most capable generation in British history, it says, with many having had long and successful professional careers.
The paper recommends that charities get better at reporting back to donors on the difference that donations make because the latest generation are unlikely to give money without knowing why it is needed and how it is being used.
The paper says that online campaigns such as the ice bucket challenge are not the answer for this sceptical generation, which has seen fads come and go. "Some fundraisers have told us they are concerned about perceptions that these types of fundraising challenges alienate older, more established donors," it says. "It is hard to predict what viral fundraising campaigns will look like in a few decades’ time, but fundraisers will need to watch out for jarring differences in expectation and tone between different age groups."
The paper also highlights the millions of pounds in donations that could be freed up from April because of the scrapping of compulsory pension annuities, and the opportunity presented by the concept of living legacies, which are tax-effective arrangements used widely in the US and Canada to allow people to make significant charitable gifts in their lifetime, not solely through their wills.
Living legacies, the paper says, could generate an extra £400m for charity in cash and assets each year, providing voluntary organisations with a guaranteed major gift or loan as well as long-lasting relationships with donors.
"Men and women aged over 50 hold more than 80 per cent of the nation’s wealth, and the majority of charitable donations each year already comes from them," said Dan Corry, chief executive of the think tank NPC, which helped set up the commission. "This gives the voluntary sector two major challenges: to find the right way to attract donations from this group, and to try and secure the donors of the future before they retire."
He said: "There is a big incentive for charities to get this right. Private donations generally mean unrestricted income and a better chance of planning for the long term. No charity can really afford to be left behind."