Wills and Trusts
Why make a Will?
- A Will ensures that your family and loved ones clearly understand your wishes.
- You are able to specify the trusted individuals that you wish to ensure your wishes are brought into effect after your death.
- Appoint a guardian to look after your children if neither parent is alive.
- Choose which relative or friend receives your property and possessions.
- You may be able to reduce the amount of Inheritance Tax paid.
- Protect your assets for future generations.
- You may be able to include schemes to reduce or negate residential care costs and include tax planning features.
What are the risks in not having a will?
If you die without a Will, then your assets will be distributed under the rules of intestacy. This may bear no resemblance to your actual wishes. Please note that if you are cohabiting but are not married, your partner could be forced to leave the home and receive no benefit from your Estate.
If you have already made a Will, it is important that it is kept under regular review. It is vital it reflects your current wishes. For instance, you may now have children or grandchildren and some of the previous beneficiaries may have died. Events such as marriage or divorce can mean that all or part of your current Will is automatically revoked, as a result that you need a new Will.
Why make a Trust?
A Trust can be very useful. A Trust is a legal arrangement which allows you to arrange for assets such as property, money or investments to be looked after for the benefit of third parties named in the Trust document or Will.
The person who puts the assets into a Trust is the Settlor. The person who manages the Trust is the Trustee and the person who benefits from the Trust is known as the Beneficiary.
You can create a Trust while you are alive or you can create a Trust on your death in your Will. In the Trust document you can identify the Beneficiaries and designate how the capital and income is to be spent and the duration of the Trust.
Reasons for creating a Trust include:
- Provide for your spouse while keeping your estate intact to be passed on to your children.
- Provide assets for someone who is unable to look after themselves because they are incapacitated.
- Provide assets for someone too young to handle their affairs.
- Control and protect family assets.
- Protect the family home from being sold in order to pay for residential care.
- Reduce the inheritance tax burden.
To discuss wills and trusts planning contact David Tournafond.