If you do not make provision for your children’s financial futures, whilst they are under the age of 18, their inheritance is held under a legal trust for their benefit. This is a complex and expensive legal procedure, as it involves an application to the courts to allow for the trust to be established. In addition to this expense, after the child reaches 18, they are quite free to spend (or squander) it.
Many people do not feel that this provision is suitable and therefore include a special and flexible trust in their professionally drafted Wills.
By using a Children’s Trust in their Wills, parents can place an age restriction on the inheritance of 21 or maybe 25 years of age. They would also nominate trustees who are people they are confident can and will manage the trust for their children until they become of age, and thus eliminate any costly and complex court fees.
These are also exceptionally flexible trusts. Should the trustees feel that it is suitable, they can advance funds to the children prior to the age of inheritance. For example, should a child need medical care or require funds for university.
If you have disabled children, you can also make further long-term, secure financial provision for them.
INHERITANCE TAX PLANNING, WILL WRITING, TRUSTS AND TAXATION ARE NOT REGULATED BY THE FINANCIAL CONDUCT AUTHORITY.