Trusts are one of the most powerful tools in estate planning, but they can seem intimidating. In simple terms, a Trust is a legal arrangement where assets are held by one person (the trustee) for the benefit of another (the beneficiary).
There are several types of Trust, each designed for a specific purpose. Here are the most common ones we set up at Castle Family Legal.
Property Trust: This protects your share of the family home by placing it in Trust through your Will. Your spouse can continue living in the property, but your share is ring-fenced for your chosen beneficiaries.
Discretionary Trust: This gives your trustees the flexibility to decide how and when to distribute assets among a group of beneficiaries. It's useful for families with vulnerable or young beneficiaries.
Life Interest Trust: This allows a named person to benefit from assets during their lifetime, with the underlying capital eventually passing to the final beneficiaries. Often used in blended family situations.
Bare Trust: The simplest type of Trust, where the beneficiary has an absolute right to the assets at age 18. Often used for holding investments or insurance policies.
Nil-Rate Band Trust: This uses your IHT nil-rate band allowance within a Trust in your Will, helping to reduce the IHT liability on the combined estate of a married couple.
At Castle Family Legal, we offer bespoke Trust solutions tailored to your specific needs. Contact us to discuss which type of Trust might be right for you.
