Why Trust a Will Trust?
A hugely common factor in most Wills is the need for a Will Trust to be included, but what is a Will Trust? Would you need one? Do they cost more? Here’s a breakdown to help answer these questions for you;
What is a Will Trust?
If any of the beneficiaries of your Will would not (or should not) be able to receive their share immediately after you pass, then their inheritance will be placed into a Trust. Using the analogy of the beautiful horse-chestnuts in the image, the Trust is the shell, then the rules and conditions of who and how the Trust is managed are the spikes. The most straight forward example of this, if it is a child benefiting, by law legacies can not be inherited until age 18. So, the funds/object/property is placed in Trust and Trustees appointed to manage them until the beneficiary can receive them. There are laws and expectations to guide the management of the Trust – to help ensure they keep up their value but remain secure during their time in Trust. Sounds like a great idea, right? If you create the Trust alongside your Will, then you will have the ability to make more decisions about how it’s managed – add more protective spikes. You will be able to appoint WHO the Trustees are – so who looks after the legacy; someone you trust, someone who understands you and so will be best placed to make decisions in a way they feel you would. You could also decide the age at which children would receive their inheritance. What would you have done with a lump sum of money when you turned 18? Invested it? Got on the property ladder? Or something else?! Perhaps age 21 or even 25 is a more sensible time to release legacies such as this, in which case if you’re writing the Trust then you can specify the age.
Would you need a Will Trust?
It’s not just children that we write Will Trusts for, and everyone’s needs are different, sometimes more than 1 type of Trust is needed. If a beneficiary is in receipt of means tested funding, then that could be massively impacted if they were to receive a financial lump sum. Again, a Trust can be built to the specifications needed to ensure the beneficiary still receives full benefit of the inheritance, but with more care and consideration so’s not to disrupt their over all situation. Perhaps you live with a partner who is not the father/mother of your children, and you’re concerned about how to ensure your children benefit from your share of your property/estate but without ‘unhoming’ your partner. Or maybe one of your beneficiaries is facing potential bankruptcy or divorce at the time you write your Will, if they were to receive funds during that process they could be swallowed up. Will Trusts can be shaped to protect for all these scenarios and more. But if none of these obviously apply to you, then you might not need one! We would still appoint Trustees as part of drafting your Will as if over the years your beneficiaries have children, who have children and so on, then there is the potential a Children’s Trust might arise anyway.
Do they cost more?
In short – Yes, they are an extension of the legal work required to build your Will. But the amount depends on the complexity. At Carson & Hughes we include the simpler Trusts, such as Minors Trusts (children’s trusts) as standard within our Will cost. We fully explain the Trust needed once identified, the potential consequences if you opted not to use one, and the cost before we start work. So you can be clear on every aspect.
Remember advice is free!
So, if you’d like to know if a Trust could/should be used to protect your beneficiaries then please get in touch and we can chat it through, obligation and cost free! If you already have a Will but need a Trust added, we can do this for you too, even if the original Will wasn’t written by us – we’re helpful like that.