![]() If you want someone to live in your house only for their lifetime, you cannot give them the title deeds. However, the bulk of the capital in the trust fund is accumulated for your children. This structure provides an income for your surviving spouse, maybe access to capital too, if you so choose. If you foresee problems in agreement between the trustees, you might additionally appoint a professional trustee or trusted friend to balance the power. This is usually done by setting up a trust where your spouse or partner is a life beneficiary and one of the trustees, and someone else such as your child from your first marriage is an ultimate beneficiary. You may decide to use an absolute trust for many reasons: To provide for a surviving spouse or partner who is not the parent of your child In a discretionary trust, the trustees have a discretionary power to distribute the income and capital of the trust fund in proportions they decide. In an absolute trust, the identities of the beneficiaries and their entitlements are specified precisely. If an absolute trust requires only the happening of a conditional event, it is also called an interest-in-possession trust. ![]() An express trust can be either an absolute trust or a discretionary trust. So if you have any child beneficiaries (or could have), then you should appoint trustees and their powers yourself in your will.Ī trust created by your will is called an express trust. The trustees have no alternative than to hold the property for the child or children until their 18th birthday(s). The powers they are given are, by default, tightly circumscribed by the Trustee Act 2000. In this scenario, the Court appoints trustees. This happens most commonly where a will maker (known as the testator) fails to provide a trust for their children under 18. If you fail to provide for a trust when the law says you must have one, the Court will set it up for you - possibly entirely against what your wishes might be. There are different types of trust funds each with properties or rules that make them useful in certain situations. If it turns out that the trustees cannot do as you ask, then they may have no alternative than to ask a judge, and spend trust money on legal fees. Powers can be as wide ranging or as narrow as you want, but be careful to make sure that what you ask can be done. Trust powers are what you say your trustees can do or must do. More often, we use the word trust fund to refer to the assets held on trust together and we shorten the term further to just trust.Ī trust fund is technically called a settlement, but other than lawyers, few people use that term. Technically, a trust is a rule (one of many) for how one or more people (known as the trustees) hold money, property, possessions and investments for the benefit of one or more other people (known as the beneficiaries). We hope that it both thorough but also easy to digest. The series combines explanations of the law with practical considerations. This article is one in a series about how to write a will.
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