Family Property Trust or Will Trust.
Property Trust Wills are often confused with Family Property Trusts. And they are very different.
a) How do Property Trust Wills Work?
Typically, Property Trust Wills set up an arrangement where the property is owned half each by husband and wife (or whatever the relationship). The property does not actually go into a formal trust until one of the partners dies, at which point there is the extra cost of doing that.
So property trust Wills are relatively cheap initially, but there is a bit of a sting in the tail when the first person dies. If one partner gets into financial problems, or needs to go into a nursing home, the other partners share is at least ring fenced. But if both owners have bills to pay, there is no protection except from each others bills (and that is limited). So property trust Wills can be very useful and protect half the property in some circumstances, and useless in others. But they are better than nothing, and may be very useful in some circumstances (ask for our information pack).
Lots of people have the expertise to set these up, though a very large number are set up badly so they won’t be fully effective. There is also plenty of scope for careless conveyancing to wipe out the effectiveness of this type of Will!
b) How does a full Property Trust work?
The way we set up property trusts is ideally to “sever the tenancy” as above, but then we transfer each half of the property into a lifetime trust, so you no longer own it. Sounds drastic, but you get to chose the trust managers and they have to look after you during your lifetime. If you don’t trust your family, then we can act as trustees (managers) or as Protectors which is cheaper. But we don’t push to become professional trustees as some firms do: in many cases, it just is not a necessity.
One of the many advantages of the lifetime Property Trust is that it makes life simpler when either of you die, and is ideal for a single person too. These do demand special expertise or things can go wrong, but as long as they are properly set up, they are very effective.
Property Trust Will v Property Trust Summary
Property Trust Wills are cheaper to start with, so a lot better than nothing if the full property trust is too much at present. (We do offer an upgrade scheme, so you won’t lose out of you start out with the lower cost option). Ask about our “trade in” scheme.
Property Trust Wills can be ideal for younger couples with children from different relationships, however.
But a full lifetime Property Trust is immediately building protection, and is much easier to deal with when either of you die. At death, the fund is immediately available. As well as being the only option for single people. Whatever the circumstances, the earlier you act, the stronger the protection you put around your assets.
Use the form below to request our information pack and ask any questions, as far as your children and grandchildren are concerned, this is potentially the best “investment” you could ever make for them.
No sales pitches! Setting up a trust – perhaps to save tax and keep what you have earned working for your family?
Will putting property in trust help? A question we are often asked, and the answer is often yes. Please give us a ring on 01323 741203 or use the form below to find out more.
Property Trust or Will Trust – which is best? In Most cases, the answer is BOTH.
A Last Will and testament is vital – but setting up a trust can ensure that there is something to leave when you die, not just a Last Will and few assets. Setting up a trust can preserve the benefit of your hard work for your children, grandchildren and great grandchildren. Or your favourite charity. In most cases Wills do very little to keep your assets safe and sound for your family, and all your hard work can very easily be lost.
Family Property Trust or Will Trust: are any of these issues relevant?
- Family who may not be able to look after their own finances wisely for any reason?
- Or who might lose benefits if they inherit direct.
- Tax flexibility – reducing inheritance tax for children and grandchildren.
- Kids better off than you are? But perhaps grandchildren etc who really do need help. Avoid paying IHT twice.
- Rocky relationships, where half of your childs’ inheritance be lost.
- Protecting against unexpected future creditors.
- Helping younger family members get started in life with grants or loans. Maybe help with university cost or house deposits.
- Recycling your legacy for up to five generations, starting with your children, should they need help.
Family trusts have a great deal to offer ordinary families.
With modern technology, we can assist far more families just like yours to benefit family trusts, so that the your hard won assets continue to look after your children, then their children, grandchildren, great grandchildren and maybe even a few more generations. In many cases, just through a straightforward family property trust simply popping your home into trust.
We are not at the leading edge of tax planning (though we can also offer IHT advice) nor do we set out to promise results which may or may not be realistic – or even legal. We just offer a range of sound plans offering the flexibility to look after you and your family for as long as 125 years. Even better, there are a range of budgets to fit most pockets.
Setting up a trust is probably the best “investment” you could make for your family…. You can read our little booklet “Legacy Trusts” or have a brief 5 minute chat to discuss the issues and see if you qualify to set up what we call The Family Bank – most home owners will be well advise to put their house in trust, so pop a note in the form below or give us a ring on 01323 741203 – please quote reference FAMILY TRUST.
There is no obligation, and no one will appear on your doorstep! We will have a quick chat with you to make sure we send relevant information, so please do let us know when you are contactable – you can’t quite get a flavour of a person and their situation just by email!
For more information on setting up Property Trust or Will Trusts:
(and don’t forget to tell us what you are looking to acheive)