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Will writing – setting up a Trust Fund

One thing you need to consider when you are writing your Will is whether you or not you want to set up a Trust Fund, particularly if you have one or more child who is under the age of 18 at that time.  Having a Trust in place means that you can leave assets of any form, including property or money, to any person or persons under the age of 18, and be assured that the money will be properly protected until the beneficiaries turn 18, the age at which the law states they are responsible enough to inherit those assets.

When setting up a Trust, Trustees must be appointed.  These individuals, who can perhaps be a qualified probate practitioner or family members will ensure that your instructions are followed, in terms of how the assets are managed until the beneficiary is old enough to take control.  For example you could choose to allow a monthly amount to be released to the children’s guardian to meet their day to day needs, or you may prefer to have all assets secured until the children reach 18.

There are several types of Trust, so it is advisable to use the services of a probate specialist to help you set one up.

  • A Fixed Trust states exactly how much, to the pound, each beneficiary is to be paid and when.
  • A Discretionary Trust states that the Trustees are given freedom to decide the amount that each of the named beneficiaries is given, based on their best judgment of the children’s circumstances.
  • An Accumulation Trust or Maintenance Trust states the provision which should be set aside usually for your children and / or grandchildren, which will attract an enhanced tax rate.
  • A Protective Trust allows an amount to be passed to a beneficiary, as a type of regular income, which leaves the capital amount safe and untouched. This is a useful provision for leaving money to a bankrupt beneficiary, or protecting the capital against someone you feel may be likely to become bankrupt in the future.
  • A Trust for a Disabled Beneficiary enables assets to be passed to a disabled person, which will attract special tax exemption.

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