Investment outlook for charities

Charity investment managers are cautiously optimistic about the future, with dividend growth expected to continue despite market volatility, though the number of respondents to a survey by charity investment managers Newton stating that their investment portfolio was due to provide sufficient income to meet their obligations fell to 61% (a second successive annual reduction) in response to increased demand for services. Political instability and concerns around levels of government debt and tax policy responses were also reflected in caution amongst survey respondents around what they deemed to be a safe portfolio withdrawal rate, with increasing numbers responding with sub 3% estimates or ‘don’t know’ (though the most popular range remains 3 – 3.9%).

Despite the uncertainty, opportunities remain for charities to strengthen their financial base through strategic investment planning. The challenge lies in balancing the needs of current beneficiaries with those of future generations. Trustees are encouraged to review their investment policies, consider ethical and Environmental, Social and Governance (ESG) factors, and ensure alignment with their charitable objectives. The outlook suggests that while risks remain, there is scope for growth and resilience through prudent financial stewardship.

Further information: Click here

If you have any questions, then please feel free to get in touch with Michaela Johns on 023 8046 1256 or email Michaela Johns.