The JBWere Bequest Report 2025 was published on 26 February 2025. Its author is John McLeod who co-founded the JBWere Philanthropic Services trans-Tasman team.
The Report can be downloaded here, but the main points are summarised below
INTRODUCTION
- The Bequest Report analyses work from Government agencies, academics and industry experts in New Zealand with comparable data and information from the UK, Australia and the USA.
- It paints a comprehensive picture of the current options for individuals in New Zealand leaving inheritances for family and encourages deeper thought about what their lifetime’s achievements could accomplish beyond them through a charitable bequest. It highlights the opportunities, and levers to improve outcomes for both those leaving an inheritance and the children that typically receive them.
- Bequesting is a critical support channel for charities and for-purpose organisations and is the most valuable return on investment in fundraising by a significant margin, yet makes up just 1.3% of all charitable income in New Zealand.
- New Zealand’s position as a comparatively wealthy but ageing nation provides a strong baseline for charitable bequests. However, the currently low proportion of people leaving a bequest, and the low percentage of assets left to charity, falls short of some of our international peers as well as the levels of giving by people during their own lifetime.
- As we stand in the midst of the largest intergenerational wealth transfer in New Zealand’s modern history, JBWere’s Bequest Report identifies the need for New Zealanders to have more conversations about leaving a charitable gift in a will and the critical role this can play in improving outcomes for both the next generation and the communities in which we live.
HEADLINE FIGURES
- New Zealand’s population growth is slowing and the annual number of deaths is expected to accelerate to over 66,000 annually within the next 50 years (near double what it is now, 37,000).
- Over the next 25 years $1.6 trillion will change hands from deceased estates.
- Under current levels only 1.3% of these inheritances are go to charities and other for-purpose organisations, far below the levels seen in the US and UK.
- Currently 6.0% of New Zealand wills make provisions for charity, yet 60% of Kiwis give financially in some way each year.
KEY FINDINGS
- Of the 55% of New Zealanders with a will, just 6% currently include a charitable bequest. This compares to 10% in the USA; 13.7% in the UK; and 6.5% in Australia. The proportion of wills that leave a gift to charities in NZ is under ½ of the UK.
- Bequests in New Zealand make up 5.1% of all philanthropy. This compares to 9.1% in the USA; 14% in the UK; and 10% in Australia.
- Health-related causes were the most supported through bequests (23%); followed by religion (15%); welfare (12%); medical research (10%); animals (8%); international (3%); the environment (2%); and other (27%).
- Of those people who leave a bequest, 84% by value is residuary, where a proportion of the estate is allocated in the will; 8% is pecuniary, where a specific amount is allocated; and 8% of people leave gifts in another way, for example the allocation of specific items.
• Charitable bequests make up 1.3% of all charitable income in New Zealand, compared to 1.8% in the USA; 4.5% in the UK; and 0.6% in Australia.
• Charitable bequests in New Zealand are predicted to increase in annual levels from a current $320 million in to over $1 billion in 20 years as our population ages.
IMPACT OF BEQUESTS
- Charitable bequests are mostly unrestricted in their use and have a return on investment around six times the average for all fundraising, meaning within the total income mix of for-purpose organisations, they are the most valuable source of income by quite a margin.
- Charitable bequests, whether one off or from a past gift to a charitable trust or a community subfund, regularly make up a significant proportion of the largest annual gifts seen in many countries. For example, 20 of the largest 50 annual philanthropic gifts in Australia come from deceased donors.
- Bequesting is not just for the wealthy, any amount can make a big difference to the causes Kiwis care most about.
WHERE ARE PEOPLE LEAVING THEIR MONEY?
- The vast majority of those inheritances will go to the partner if still in a couple relationship (98%) or the next generation (who will be almost 60 years of age) if they are single (85%). The remaining mostly goes to other family and friends. The overall proportion left to charities and other for-purpose organisations is around 1.3% (this represents only a quarter of the US and UK levels).
- While leaving to a partner is unsurprising, on average and within 10 years, that person faces a bigger choice in how best to pass on their (and their partner’s) lifetime of assets and values. This is predominantly a decision made by women.
- The Bequest Report proposes thinking of “the full family balance sheet” when preparing a will, including non- financial assets, and a deeper meaning of legacy and passing on values that can be achieved with stronger connections to community.
CURRENT GIVING
- JBWere analysis shows the estimated value of inheritances that passed in 2024 was $27 billion.
- Generally, the value of older peoples’ assets, and eventually inheritances, is less affected by current cost of living issues, although this certainly is not true for all.
- Cost of living pressures are currently being widely felt, and real average earnings growth has lagged over the same period compared to the higher levels of asset growth.
- In addition, it’s estimated 10% of personal wealth is given as gifts during lifetime which may grow during the current cost of living and housing crisis as parents assist their children.
- We expect to see strong growth in family foundations and community subfunds “giving while living”. This could be further encouraged in New Zealand through tax incentives, like those in place in the US.
THE NEW ZEALAND CONTEXT
- Country differences such as inheritance and estate taxes are part of the reason for currently lower levels of giving in wills, but practice, culture, and discussions about such bequest options are immediate opportunities for increasing charitable bequests.
INTERGENERATIONAL WEALTH TRANSFER
- Global populations will peak this century and the current ageing cohort in New Zealand is set to continue to change the shape of our country.
- Total inheritances are estimated to grow from around $27 billion that was passed in 2024 to a total of $1.6 trillion by 2050, under current tax policy settings and rest home and health costs.
- New Zealand’s population growth is slowing at a rate faster than many other countries, and while future migration numbers can alter this trend, we will still experience a dramatic increase in the number of older age people in the population.
- New Zealand remains near the top, globally, for average household wealth and even higher on median wealth measures, meaning a more even spread than most countries.
- Importantly and contributing to the scale of future inheritances, the wealth transfer is happening from the older and wealthier cohort of Kiwi households.
- When we combine the increase in expected deaths with the high and growing asset values of the population, particularly the older cohort, we can see a powerful rise in the value of future inheritances in New Zealand.
- There is an opportunity to radically grow levels of giving, including structured giving, such as individual charitable trusts and sub-funds, within community foundations, substantially and boost them further by a charitable bequest allowing the passing on of values through ongoing philanthropy
REPORT RECOMMENDATIONS
- If New Zealand could increase the rate and value of charitable bequests to 3% (still below international standards), the value could reach almost $2.5 billion annually within 20 years.
- Increasing discussion among families and financial and legal advisers, and growing awareness of peer giving through inheritance, can have a large influence on normalising giving in wills.
- Alongside normalising charitable bequests, introducing ‘living bequests’ where a small current tax incentive is given for a larger binding bequest in the future, as seen in the USA, could enhance giving from inheritances.
- Having robust data is important for understanding trends around charitable bequest giving and further data and research is needed in New Zealand to inform strategies to gain a share of this growing income.
- We recommend reinstating the collection of bequests received by charities as a separate data point rather than just be included in overall donations as Charities Services had done between 2010 and 2015.
JBWERE …
- … can guide discussions on family values and philanthropic goals, leveraging insights from our Bequest Report to create a shared vision for the future of a family’s charitable giving – now and when you are no longer with them.
- … can also support for-purpose organisations who would like to explore how to turn the insights in our Bequest Report into an enhanced bequest fundraising strategy.