What is a Trust and how does it work?
A trust is a more comprehensive way of safeguarding and protecting your assets and ensuring they are distributed to your chosen beneficiaries in accordance with your wishes.
There are different types of trusts that can either be written in to your Will so it comes into effect upon your death, or set up during your lifetime and effective straightaway. With a trust, you can protect your beneficiaries and your legacy against certain ‘threats’. For instance, you may have concerns about a beneficiary’s relationship and only wish them to benefit directly, or you may have vulnerable beneficiaries who are unable to responsibly manage a lump sum inheritance. By including a trust in your estate planning, trustees will be appointed to act upon your wishes.
Trusts can also:
- Help reduce the cost of probate.
- Help achieve harmony by providing a clarity of wishes and ease of distribution.
- Make the payment of any inheritance tax easier.
- Protect against sideways disinheritance.
- Stop future claims on your estate by people who you may choose to exclude.
What is probate?
After your death, your executors (which could be a family member, friend or relative) will have to look after your estate and financial affairs. This could include things like closing down your bank account, settling bills and debts or filing Inland Revenue or land registry forms. If a Will has been left, the probate involves checking that it is legally valid and confirms who the executor is. In the absence of a Will, this can be complicated.
If you have any questions about trusts or probate please get in touch with our member engagement team or visit your nearest branch and our friendly staff will help you work out the best approach.
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