The Benefits of Trusts
Please watch the video on the benefits of trusts. Our Trust enquiry line is on https://www.theprobatedepartment.co.uk/contact-us-for-probate-help. If you own a home. run a business, have dependants who can’t manage their own affairs, or you give professional advice, do read on.
Why would I want to set up a trust?Who can make a trust?What are the benefits of trusts?What can I use a trust for?What is a trust? What is a pilot trust?What are the pitfalls of trusts?
Benefits of Lifetime Trusts
Lifetime Trusts have been an important part of Legal Planning since the time of the Crusades when knights and noblemen cam back only to find that the people they had entrusted their lands to would not give them back. In the interests of Justice, the Lord Chancellor invented the concept of Trusts – property technically owned by the Trustee, but for the benefit of a third party.
Anyway, the legacy of the Crusaders has been of great benefit to generation after generation and continues to be so to this day. Most homeowners should have a Trust or two. Pensions and life insurances are often in Trust so that the benefits can be paid out flexibly to the right people at the right time.
Children who may never be able to manage their own finances are in particular need of having parents with the foresight to set up Trusts. Another common use is MAD – marriage after death, which is becoming the norm as people live longer. It can – and does – result in the wholesale transfer of assets to families totally unconnected with the folk who originally worked for years to build up the assets. One of the original couple dies, the other inherits everything, remarries then dies and leaves everything to the new partner who leaves is to his or her family.
Trusts can be of greater benefit than ever in these days of blended families. Both sides usually intend to do the right thing, but often one set of children end up be cut out entirely. A Family Trust, set up in the right way, can be fair to everyone, look after the second (or third..) time spouse or partner, but still ultimately pass to the original bloodline.
Trusts provide many opportunities to cut down on tax, to look after folk who perhaps are easily led or on benefits. Why take the risk of your cash been squandered, or just replacing State Benefits and giving no extra help? One of the advantages of Trusts is that they can ring fence assets to be used only for the right purposes, as longs as you choose good trustees to manage after you have gone,
One of the Trusts we offer is called “The Family Bank” as it can offer help to the family for as long as 125 years, through a series of loans being recycled, potentially saving Inheritance Tax, reducing probate delays and looking after vulnerable beneficiaries.
If you run a business, then you are in special need of Trusts to protect assets which might be at risk if, Trump-like, your venture goes pear-shaped. These days, businesses need to be very nimble, and lucky, to survive for long. No good trying to set up a Trust when things are already bad though! Protection must be put in place in good times, or the benefits of trusts may well be lost.