I have just finished reading ‘A 100-year life’ by Lynda Gratton and Andrew Scott. It was my secret Santa present last Xmas (oh we never stop driving ideas at nfpSynergy even if sometimes a little slowly!). Its rich with insight and stimulating ideas about how things will change as more and more people live to a 100 years old. The core ideas are that people will need to work longer, plan more for retirement, change their relationships and careers, and of course their finances. While the book covers the impact on individuals, businesses, government and society, it doesn’t really look at the impact on charities.
So here are my thoughts about how a 100-year life will impact on charities:
More poverty in old age
It’s hard not to see poverty increasing as we have more people living longer. Over the next 25 years those aged over 65 will increase by 60%. Even over the next decade, while pensions are still relatively good, there are going to be more and more people who will struggle to make ends meet. In 20 or 30 years, as we have people hitting retirement who don’t have a defined benefit pension scheme (e.g. 25/60th of final leaving salary) but a private pension plan without enough money in it, the levels of poverty could be even higher. One calculation is that to have a pension of £25,000 a year then a private pension pot of £500,000 would be needed. Charities will need to help deal with a growth in large numbers of increasingly elderly people whose pensions simply don’t cover their needs.
Demand for housing increasing
As people live longer the number of houses needed to support them goes up – the UK population is forecast to increase by 4.1 million people by 2024. As we get increasing numbers of single people, either because their spouse has died, relationship breakdown in later life, or they never had a partner, then where a couple used to have one house, now two may be needed. So government, housing associations and homelessness charities will need to build or campaign for an ever increasing number of properties. It’s hard to see an end to the shortage of housing, particularly social housing, anytime soon.
No end to the need for immigration
With an increasing number of people living longer, and needing both health and social care support, we will need an increasing number of people to look after them. For all the talk of Artificial Intelligence taking jobs, the need workers to look after elderly people, or be nurses, care staff, doctors, or social workers is only going to go up. And with the number of people of working age staying static or decreasing, the need for immigration to fill those roles is hard to escape. Immigration is sadly a divisive topic so expect those charities dealing with race-hate, refugees, immigration policy and the like all to be kept busy in the future.
No end to the squeeze on government finances
There are many who call for an end to austerity in the current climate. This in effect means increasing taxes, or increasing borrowing to provide more government expenditure. National debt has increased by more than 60% since 2010. Increasing numbers of people living longer, needing health and social care support, and many in the varied degrees of poverty can only mean a continued squeeze of government finances. Pensions are already 26% of central government expenditure, and is only likely to increase as a percentage of spending. If we go on borrowing, we are loading our children and our children’s children with a growing burden of interest repayment. There are no easy solutions to the growing demand on government finances, and no likelihood that charities will find government as a ready source of funding again.
Health and social
If the economic impact of a 100-year life is likely to be severe, what about the impact on health and social issues.
More lonely and isolated people
As we get more people living longer and longer, it’s inevitable that there will be more and more isolated and lonely people (many living in poverty). This is because a frail 95-year-old may have frail offspring in their seventies who don’t live anywhere near them or can’t travel easily. It will also be because couples are increasingly likely to find that while a man dies in his seventies, his spouse might live another 20 or 30 years. So, for those charities which provide social services for older people, there is likely to only be an increase in demand.
Digital have and have-nots
Over the coming decades the way that people access the world is going to be increasingly online. Indeed, there are few under the age of 60 who aren’t part of the digital world (and poverty is a major factor in exclusion from the digital world). As today’s 40 and 50 somethings reach retirement age it is fair to assume that they will be digitally literate. But whether they are digitally literate for the world they will then be living in at the age of 90, is another matter – most in their 50s today are fine with email, but what about using smartphone apps for paying bills, or public transport, or making online purchases. And being online also means having the right equipment – how many of us are using a phone or laptop or tablet that is more than five years old. So poverty on its own may increase social exclusion, by making it hard to have the equipment needed to keep up with the digital world.
Farewell the Big C and welcome the Big D
100 years ago the Spanish Flu, just after the first world war, killed around 20 million people. Today Cancer is our biggest killer in the UK, followed by heart disease. Increasingly though people are surviving longer and longer with cancer, and the same is true of many other once fatal diseases. So as people live longer and longer with cancer will we come to see it in the same way we see sciatica, or migraines, or chronic fatigue: deeply debilitating but far from a killer disease. Indeed, our assessment of the worst diseases may switch from being those that end life, but those which take away people’s quality of life. So, on that basis in 25 years’ time, we may see dementia being as much feared and fundraised for, as cancer is today.
There are a range of ways in which services and activities for charities might change. Here are three suggestions:
More relationship guidance for older people
As people live longer the time period when a couple are together in old age gets longer. Back in the 1920s, when a man only lived an average of 3 years after retiring, and had been out all day at work in the working years before that, there was little time for retirement relationships to be tested. In today’s world the strains on many relationships can only increase when somebody may live 30 years after retiring, may have career changes or periods of unemployment, or expect a retirement of leisure which they can’t afford. So people will need support and advice on how to deal with this changing world, and probably not just partners. Parents will need help dealing with their impoverished children or grandchildren. Children will need help dealing with their parents who have inadequate pensions and chronic illnesses. Equally 70 year olds will need help negotiating the world of dating and new relationships. The number of ways that people may need help from charities in negotiating relationships can only increase. It’s still much cheaper for society to spend £1000 on marriage guidance then build a second house when two elderly people separate.
More debt-advice and financial support charities
As it gets harder and harder to put sufficient money aside for a personal pension, and government provision is cut back, many people will find it difficult to get by. So, expect those charities that provide debt and financial provision, as well as benefits advice, to see an ever-growing demand for support. We might also expect to see a growth in the benevolent funds that cater for specific professions, and a growth in employees feeling they need to support their own professions’ benevolent funds.
Struggle for the causes not in the political or media spotlight
From the ideas put out in this blog, it’s not hard to see how charities who deal with older people, poverty, or money advice, might find themselves in the media spotlight, or getting increased levels of political interest or government funding. The converse is that those causes that don’t appear to be tackling an issue that society sees as relevant, may find it harder to raise money and harder to get their voice heard. We see this already in government funding with the way that NHS funding is a hot political potato, but funding of police and prisons and local government has been relatively easy to cut. Charities that aren’t in the public eye will need to work twice as hard to get their message across.
There are many reasons to be gloomy about the future of fundraising in charities as my recent blog sets out. Two that are specifically linked to an ageing population are:
Less money for giving and volunteering
The finances of almost every age group of society under 50 is going to be under pressure. Today’s 30-year-olds are needing to put 20% of their income into pensions, pay their student debts, save for the deposit on a house, and so on. In 20 years’ time those pressures will only increase, as they may need to support parents or relatives who don’t have adequate pensions, while dealing with a jobs market that is uncertain and a career that has many phases. So how amongst all this financial pressure are they going to find time to volunteer or money to give?
A decade or so of legacy feast followed by legacy famine
Baby boomers are currently hitting their seventies. They have good pensions and own lots of property. So for the next 10 or maybe even 20 years they will have the ability to give generously through legacies. However, as a generation comes to retirement who have worse pensions, who are trying to get themselves or their children on the housing ladder, who may be providing for their parents who need expensive residential care, the amount available for leaving in a legacy may not be as great. So the advice to charities is to grow their legacy income now, while they still can.
This list of impacts on charities is far from exhaustive. And indeed, every charity should always be working out how the changing economic and social fabric of our society may impact on them in the future. Take a look at the new edition of our free report ‘Look nfpSynergy did my PEST analysis for me’ and on the specific area of an ageing population NPC produced a very useful report from their Commission on ageing and the charity sector.