Lifetime trusts and your legacy

Do you know the types of trusts available to you?

Trusts are legal arrangements where you give up certain assets (cash, property or investments). These assets may only be used by the people you choose, for the purposes you set out when you create the trust.

There are two main types of trust:

• ‘Will trusts’ are created within your Will to protect property and assets you hope to pass on to your family.
• ‘Lifetime trusts’ are created during your lifetime, and start as soon as they are created.

Your chosen ‘Trustees’ will be responsible for managing your assets as per your (the Settlor’s) instructions. These assets may not be considered as part of your estate or your IHT bill and will avoid probate – and can therefore be given to your chosen beneficiaries more quickly.

There are nearly as many different types of trust as there are ways of using them. Here are a few popular examples:

• To provide for vulnerable beneficiaries
• To ensure that your wishes are carried out
• To pass on control of assets while the settlor is still alive
• To protect assets from creditors or even certain family members
• Avoid probate

Can I set up a trust myself?

Trusts can have many different uses, and it important that you set out your wishes carefully when creating a trust because in many cases trusts cannot be revoked – or are expensive to do so. We would therefore recommend that you get help from an expert to avoid costly fees from ambiguous wording. As there are fees associated with setting up a trust, it can help to talk to your adviser about what other options are available.

For example – you may find that a Will is a suitable vehicle for protecting your assets and ensuring that your wishes are carried out, depending on what you want to achieve.