Caversham Bridge Newspaper – October 2021
The following article is in the Caversham Bridge newspaper – October 2021. Caversham Bridge Newspaper is available to purchase from Fourbears Bookshop and other outlets within Caversham. More details from The Caversham Bridge Website.
Trust in Trusts.
You might think that Trusts are used solely by the very rich and by those people with complex estates to manage. Think again, Trusts are used by people like you and me every day to better protect their families and their inheritances.
Trusts in some form have been around since the 12th Century and have been recorded as used by Knights to ensure their lands were looked after when they went off to battle – hence our business name!
In more recent times though, home ownership really triggered the use of trusts for normal people who, for the first time, had a very valuable asset they wanted to protect and hand down through their families. This is still very true now, with home values at an all-time high, a Trust is a good strategy to pass these assets on to future generations.
There are many reasons to set up Trusts:
- To protect – Trusts can protect your loved ones who may not be old enough or have the capacity to manage their inheritance.
- Minimise threats – Trusts can minimise a number of threats against your estate including your beneficiaries; going bankrupt, divorcing, partners marrying someone else, care costs and maybe even from the more unscrupulous members of an extended family.
- Tax mitigation – Trusts can be used legally to mitigate Inheritance Tax and / or Income Tax implications for your beneficiaries on your death.
- To stop conflict – Your trust can minimise potential conflict between your family after you have gone. Trusts can be very specific and binding on how you want your estate to be divided up. Indeed, each beneficiary can have their own separate Trust to further help reduce potential conflict.
- Privacy – For most of us, a Will at some stage will become a public document, a Trust can add a layer allowing your wishes and your beneficiaries to remain confidential.
A professional Estate Planner or a solicitor should listen to your overall requirements for your Will or general Estate Planning and then, if necessary, produce a plan that includes specific trusts for your needs.
You will need to think about:
- Who you will appoint as trustees (the person / people who will manage the trust) normally we recommend two, this can be someone you know, but we also suggest that you have a professional trustee as well.
- Your beneficiaries of your estate via the Trust.
- Your specific instructions for your Trustees on how your estate should be managed and how your beneficiaries will benefit.
As with all Estate Planning, our advice is to prepare sooner than later to ensure that it is completed before it is too late. Choose a provider you are comfortable with, one who will take the time to answer any questions you might have, and will be transparent about all costs associated with having a Trust – both for the formation of but also ongoing as these can vary greatly.
Most importantly – get it done!