EDITORIAL / Help would-be donors bequeath their assets with peace of mind
14:43 JST, October 31, 2021
Donations by bequest, the practice of donating assets to a public interest group or other organization after one’s death, are becoming more common. Whether this trend will take root will depend mainly on whether a system can be established to connect prospective donors with recipients and facilitate the procedures involved.
Such donations involve a person making a will and donating assets to a specific person or organization after death. Many organizations will accept even small donations of this kind and allow the giver to specify how the assets can be used.
Unlike donations before death, the giver has no need to calculate how much money they will need for their sunset years. Donations of even a small portion of inherited assets, which are estimated to total 50 trillion yen a year, would help both charity organizations suffering from a shortage of funds and various people in need.
The Nippon Foundation set up a special contact center in 2016, and it received nearly 2,000 inquiries last year.
In one case, a donation was used to help build a gymnasium in Cambodia, in keeping with the wishes of a donor who wanted the gift “to help people overseas, where conditions are more difficult than in Japan.” The donor’s name was placed on the gymnasium so people would continue to know about their feelings.
The growing interest in donations by bequest has been attributed to the spread of so-called end-of-life planning, in which people prepare for the conclusion of their lives, and an increase in the number of unmarried people and childless couples.
In a survey of elderly people aged 70 and older, many people said they became interested in donations by bequest due to the novel coronavirus pandemic, and the most common motivation for considering such donations was that they wanted to choose for themselves what would happen to their assets. More and more people appear to be thinking about contributing to the next generation.
However, in order for good intentions to be carried out, donors need to take the appropriate steps before their deaths.
The first prerequisite is to leave a formal will. Spouses and children are entitled to an inheritance under the Civil Code. It is advisable to obtain prior consent from them for donations by bequest.
Some organizations advise prospective donors to consult with them in advance regarding assets such as real estate and forests, since they are difficult to handle.
Many people have likely felt that the procedures involved are too difficult or have been uneasy about them. It is essential to create a system in which people can easily receive advice from experts.
The Japan Legacy Gift Association, which promotes the spread of donations by bequest, strives to offer consultations with experts and introduce organizations to which people can donate.
Some organizations do not have much experience in receiving donations by bequest and are unable to handle the series of procedures on their own. It is important for such organizations to gain people’s trust by acquiring expertise through training and other efforts, and by establishing a track record of using donated assets effectively.
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