What is a Family Trust?
A Family Trust allows you to ‘ring-fence’ your assets during your lifetime. It is specifically designed to protect your assets so they can be passed on to your spouse, children, grandchildren, or other beneficiaries after your death.
You would usually use the trust to protect your home and any surplus savings or investments, leaving enough money to cover your ongoing living expenses. The income from any savings or investments held within the trust can be paid directly into your bank account to top up any other income you receive.
Just like a safety deposit box, assets can be added and removed from the trust during your lifetime. For example, you may need to buy a new car and can have funds transferred from the trust to cover this. Or you may receive an inheritance you want to put in the trust, so that it is protected for your beneficiaries.
You are the ‘Principal Beneficiary’ of the Trust and retain full control of the assets within the Trust while you are alive and have mental capacity. You have a guaranteed right of occupation in the property for the remainder of your life and cannot be evicted under any circumstances. You can even direct the Trustees to sell the property and to buy a new property of your choice. If the new property you are acquiring is more expensive, the Trustees can only be required to buy the new property if the additional capital required is paid into the Trust by you.