Rather Than directing assets absolutely to individuals then to potentially protect the inheritance, a trust will can direct assets to appropriate Trusts. Assured Private Wealth recommend establishing Trusts which will be written into the will. These are Trusts written into the will and would only be established when the death occurs.
Depending on what Trust/s are needed, Assets are protected against, Divorce, Re-marriage, Generation Inheritance tax, bankruptcy, sideways inheritance and possible care home fees. Also allows Trustees to control amounts of money to younger people.
Consider upon your death, you want your spouse/civil partner to be happy in life and as time has gone by, they meet someone new and decide to get married, as marriage revokes a will it is important that a new will is drafted. If the new marriage does not work and a new will as not been drafted the new partner could receive 50% of what assets you had left your family, worse still if your spouse/ civil partner was to pass away the new partner could receive everything leaving your children with nothing.
You may also want to protect your Children / Grandchildren against squandering large amounts of money, they may have or develop a gambling addiction or substance control issues, by appointing Trustees they can control and help protect the assets for your chosen beneficiary’s future.
Life Interest Trust.
Life interest Trusts are one of the more common type of trust put into a modern day Will. There is really no doubt that having a property trust in your Will is an extremely useful provision. Whilst the Trust ensures that your spouse/civil partner can remain living in your home and receive any income once you have passed away, it also ensures that your property is protected for your children’s future.
The Trust will itself is not the Trust document but will contain the wording and the expectations of the testator when the Trust is set up on his or her death, and therefore, there will be additional cost which is borne by the death estate as a testamentary estate.
Your letter of Wishes.
Each Trust has a letter of wishes which sets out your instructions to the Trustees of how you want them to deal with the trust assets. For example, this may state that each trust is for the benefit, such as a spouse or partner, and after that to be shared equally between your children. The letter of wishes is flexible, to allow for any future change of wishes you may decide on. In order to be able to follow your wishes, there must be at least two trustees. Beneficiaries can be Trustees. It is important to choose people who can work together amicably to follow your wishes. Please give some consideration to whom you would like to appoint.