Trusts

Protecting what you own and making sure your assets end up in the right hands is of great concern to many people.

The greatest concerns seem to be:

• Are my assets at risk if I end up in long-term care?
• What happens if my children get divorced after they inherit?
• How do I protect a disabled beneficiary?
• Can I control how my money is used, such as paying for tuition fees?
• Will my children use their inheritance wisely?
• What happens if I get remarried?
• Can my children lose their inheritance if they are made bankrupt?
• What happens if my wishes are contested?

Some are tempted to give away assets during their lifetime or transfer the ownership of property into their children's names, but these are not safe or effective ways of ensuring your assets get to the right people.

The truth is, a ‘standard’ Will may not be enough when it comes to protecting your assets. Trusts are a safe and effective way of protecting assets and can be used in a variety of situations.

• Set up during your lifetime, enabling you to keep control of your assets during your lifetime
• Set up from instructions in your Will when you pass away

The most common type of trust is known as a Protective Property Trust. The first step towards having this type of trust is for 2 people who own their property jointly to own it as Tenants-in-Common. This means that each person has a defined share in the property, for example 50/50. This is called a ‘Severance of Joint Tenancy’. Informing the Land Registry of this change is a straight forward process that will be taken care of for you.

Protective Wills include instructions to place the deceased’s share of the property in a trust upon the first of you to die. This has the effect of ‘ring-fencing’ or protecting half of the property when the first of you to dies from such threats as:

• Care fees for the surviving spouse/partner
• Remarriage of the surviving spouse/partner
• The surviving spouse changing their Will contrary to the wishes of their deceased spouse/partner

Importantly, protections are in place for the surviving spouse as they will be given a life interest in your property. This means that the surviving spouse can:

• Reside in your residential property for the rest of their life
• Move home (downsizing or upsizing)
• Receive any income generated from any assets held in the trust
• Receive any capital belonging to the trust on the agreement of the trustees
• Be involved with decisions, as the surviving spouse will act as one of the trustees

After meeting with you to discuss your personal requirements and concerns, we will be happy to make a personal recommendation in relation to the use of trusts.