Trusts have been available as a financial option for many years since the crusades; they give you the power to control what happens to your finances and assets, keeping them out of any potential “asset splitting” situations such as divorce in the family. They do this by legally being held by the trust, you as the settlor create the trust in addition to which you are also the trustee and remain in control of happen happens to the assets. This is where the debate lies as to whether you can trust trusts. As the assets now belong to a trust and not a person, they cannot be assessed by the government and councils for future mean testing, such as care home fees. If avoiding fees via the trust for means testing is the motive for setting a trust up, then the local authority can challenge the assessment due to “deliberate deprivation”, but there are many other reasons to set up trusts.

When is making a trust the right decision? Trusts are useful tool in bloodline planning, keeping the assets flowing through the family and out of any marital issues. With the number of divorces on the rise, the odds of it impacting your family increases and it could happen in several generations. If each of these couples split the joint assets 50:50, by the time the original finances reach the grandchildren 75% could be ‘lost’ through divorce settlements, with only 25% remaining within your bloodline. Had a trust been put in place the assets could not be counted as part of any settlement, so the full 100% would remain within your bloodline, future-proofing your family’s financial future.

Many people worry about the loss of control of their finances by setting up a trust, but there’s really no need, because as a settlor setting up the trust you retain control of your finances and can even dip into them should the need arise.

Trusts are a reliable way to keep control of your assets in the future, providing you are putting them in place for the right reasons. To ensure your financial plans don’t leave you open to prosecution and protect your family’s financial future in the way you want, discuss them with a reputable financial advisor to future-proof your finances.

If you want to protect your family’s inheritance using Trusts, when why not call to arrange a chat?