At Wills 4 Less we think safeguarding your family shouldn't be a gamble. Under UK law, a discretionary trust is also one of the most effective instruments to provide for your family come what may.
Picture, for example, leaving money directly in your will for a child or any other vulnerable family member. This may affect their eligibility for means-tested benefits or expose them to financial abuse.
This is avoided if the assets are held in a Discretionary family trust that controlled by someone else (a trustee) for you; meaning that your beneficiaries can be financially supported even while protected.
In the UK, a discretionary trust is often used for:
Without a Discretionary family trust Amersham, your property may:
Who should have a discretionary trust? A discretionary trust is suitable for those who are looking to protect their wealth and loved ones in the most flexible way. If you have young kids, a Discretionary family trust will help to ensure that funds are disbursed sensibly before they are old enough to make responsible financial decisions.
If you care for an incapacitated or vulnerable family member, a discretionary family trust can also be used to make provisions for them without compromising their eligibility to receive income-tested benefits. For more details, visit https://amersham.wills4less.co.uk/discretionary-trust/
If you:
Well then, you need a testamentary discretionary trust in your will. Without it, your money might disappear up the wall in care fees and tax needlessly.
Picture having £200,000 bequeathed to your child at 18. It sounds supportive, but is it smart? Most young people aren’t ready to handle such a large amount at that stage in life. Without direction, it can easily be frittered away on things that don’t insure their future.
With a discretionary trust, the trustees can drip-feed funds for university fees, a first property or other essential requirements – rather than giving them (near) carte blanche at an age when they might not be able to handle it. This way your money is really invested in their growth.
Consider that loved one with learning disabilities. An outright windfall could disqualify them from essential state benefits and be susceptible to financial exploitation. The safeguard against all of this is a discretionary family trust that ensures money for their care and welfare will be kept safe and managed for them.
Or imagine your child divorcing at a later age. Money inherited straight out would be risked in a divorce settlement. 2\. A discretionary family trust protects your assets for them and future generations.
A discretionary family trust is not just a legal device. It’s a way to love your family from beyond the grave.
What is a Discretionary Trust?
A discretionary trust is a legal arrangement in which you place assets (money, property or shares are typical) into a trust fund for trustees that you nominate to look after. Unlike in the case of a straightforward gift or fixed trust, automatic entitlement to those assets is not conferred on the beneficiaries. Instead, it’s your trustees who determine how and when the beneficiaries get the money, providing you with maximum flexibility and continuing control even after you’re gone.
This means your trustees can:
At what point do I need to think about having a Discretionary Trust in my Will?
You may want to think about creating a discretionary trust if you’re trying to protect assets for loved ones who might not be able to fend for themselves, such as minor children or beneficiaries with little financial know-how. It’s the perfect solution if you have concerns over care fees, remarriage or inheritance tax.
For example, if you put it in your Will you can be sure that Trustees can cater for your family as their circumstances adapt. It provides the reassurance that your wishes will be respected, and you’ll have peace of mind that everything will be done in the correct way for those you care for.
How frequently should a Discretionary Trust be reviewed or re-settled?
It’s smart to revIew your discretionary trust every 2-3 years or life events (births, deaths, marriage, divorce and financial changes). Others are concerned that their trust might not align with current tax laws or family needs.
Ongoing reviews that your wishes will be enforced, your loved ones are secure and that the trust does what it’s supposed to do. Call us today to discuss your trust and keep your estate plans current for your own peace of mind.
What is the cost to put a Discretionary Trust in my Will?
In the UK, you can expect to pay somewhere between £250 and £800 depending on the complexity of your discretionary trust and if there’s any legal advice involved in making one. People worry about the extra bill, but are relieved to know that it will ensure loved ones aren’t being put at risk and they won’t be simply passing on an inheritance tax burden.
It is a small price to pay for peace of mind and security for the family in the long term. Talk to us for a simple, tailored quote/information about adding a discretionary trust in your Will with confidence.
What is the operation of assets in a Discretionary Trust?
It is the trustees you choose who will administer the assets in your discretionary trust. They:
A lot of folks are concerned that funds may be misused, but trustees exercise prudence for the benefit of your loved ones. This is a convenient compromise that ensures your family’s future is still safe and secure.
What are the most common errors when establishing a Discretionary Trust?
Common mistakes include:
By avoiding these mistakes, you can make certain your trust shields your loved ones. For expert advice and peace of mind contact us today.
Specialist UK Law - Our skilled practitioners are trained in drafting discretionary trusts that meet current UK law and tax requirements.
Great Prices – We feel that everyone should protect there family for an affordable product.
Peace of Mind -Sleep well at night because you know your kids and other loved infirm are protected.
Quick & Easy – Our staff makes setting up a discretionary family trust simple and easy so that you can easily understand without any lawyer speak to confuse you.
Tomorrow, no one can tell. That one little discretionary trust placed in as part of your will today might be the difference between your loved ones being looked after and going to the wall. The earlier you establish a discretionary family trust the longer you can enjoy peace of mind, secure in the knowledge that your family’s future has been looked after in every way.
We Make It Simple
Here at Wills 4 Less, it’s so easy for you as our helpful advisors explain what a discretionary trust is doing point by point. We make sure your trust is written well, and that your trustees know their jobs as well as that all of your beneficiaries will be protected the way you want.