TRUSTS

What is a Trust?

A trust is a legal way of protecting the assets that matter most to you, whether that's your home, savings, investments or an inheritance you wish to pass on. By placing assets into a trust, you can ensure they are managed and distributed according to your wishes, for the benefit of the people you choose.

When used appropriately, trusts can provide valuable protection for family assets, help safeguard the family home, support vulnerable beneficiaries, and ensure that wealth passes to future generations in a controlled and secure way. They can be a powerful tool for preserving your legacy and giving your loved one’s greater financial security for years to come.

Do I need a Trust?

A Trust is a legal arrangement that allows assets to be looked after by trusted individuals on behalf of chosen beneficiaries.

Trusts can be used to protect family wealth, provide for children or vulnerable loved ones, control when an inheritance is received, and in some circumstances help with inheritance tax planning.

Whether a Trust is right for you depends on your family circumstances and your goals, and we can explain the options in plain English during your free consultation.

There are many types of trusts, but most estate planning arrangements fall into a handful of common categories. A trust is simply a legal structure that allows assets to be managed by trustees for the benefit of chosen beneficiaries.

Trusts can help protect family wealth, provide for loved ones, control how inheritances are distributed, and in some circumstances assist with inheritance tax planning.

What a Trust can do for your Family

Trusts are often thought of as something only wealthy families need, but they can be just as valuable for ordinary households. The right trust can help protect a share of the family home, ensure assets ultimately pass to your children, provide security for loved ones who may be vulnerable, and preserve an inheritance for future generations.

A trust can also give you greater control over how and when assets are passed on, helping to ensure that the wealth you've worked hard to build reaches the people you intend it to benefit.

Every family is different, which means there is no one-size-fits-all solution. That's why we take the time to understand your circumstances, your concerns and your goals before explaining the available options in clear, straightforward language. We'll help you understand what may be appropriate for your situation and just as importantly, what may not be.

Trusts within your Will

"A simple way to think about it."

Many trusts are established through your Will and only take effect after your death. Examples include Property Protection Trusts, which can help preserve your share of the family home, and Discretionary Trusts, which give your chosen trustees the flexibility to decide how and when beneficiaries receive their inheritance.

These arrangements can be particularly valuable for blended families, helping to protect a surviving partner during their lifetime while ensuring that your children ultimately inherit according to your wishes. They can also provide an extra layer of protection for beneficiaries who may need support or where you want greater control over how an inheritance is used.

At Falcon Legacy Planning, we believe in straightforward advice. We'll explain both the advantages and the potential drawbacks of any trust arrangement in plain English, so you can make informed decisions with complete confidence and no surprises.

DIFFERENT TYPES OF TRUSTS

Here is an explanation of the different types of Trusts.

Living (Lifetime) Trust

Created during your lifetime rather than through your Will.

Assets are transferred into the trust whilst you're alive and managed according to the trust terms.

Revocable (Flexible) Trust

A trust that you can amend, update or cancel during your lifetime. It offers flexibility and can help with asset management and avoiding probate in some jurisdictions, but generally does not provide significant asset protection or inheritance tax advantages.

Irrevocable
Trust

Once established, this type of trust generally cannot be changed easily. It can provide greater asset protection and may have inheritance tax planning benefits, but it requires giving up some control over the assets.

Testamentory
Trust

Created by your Will and only comes into effect after your death. Often used when beneficiaries are young, vulnerable, or where you want trustees to manage an inheritance until beneficiaries reach a certain age.

Family
Trust

A broad term for a trust designed to hold and protect family assets for future generations. These are commonly used to provide flexibility, asset protection and succession planning.

Discretionary
Trust

Trustees have discretion over how and when beneficiaries receive funds. This can be particularly useful where circumstances may change, or where beneficiaries need ongoing protection. It is one of the most common trusts used in UK estate planning.

Bare
Trust

The beneficiary has an immediate and absolute right to the trust assets. The trustees simply hold the assets on the beneficiary's behalf until they are legally able to take control.

Interest in Possession Trust

One beneficiary has a right to income from the trust (for example, a surviving spouse), while the capital passes to other beneficiaries later (such as children).

Vulnerable Person/Special Needs Trust

Designed to provide for a disabled or vulnerable beneficiary whilst helping to preserve their financial security and, in some cases, their entitlement to certain benefits.

Life Insurance Trust

Used to hold a life insurance policy outside of your estate so that proceeds can pass quickly to beneficiaries and may not form part of the estate for inheritance tax purposes.

Which trusts are most relevant?

For most families, the trusts most commonly considered are:

Life Interest Trusts (commonly used in second-marriage situations)
Protective Property Trusts (often used in Wills for couples)
Discretionary Trusts (for flexibility and asset protection)
Children's Trusts (for young beneficiaries)
Vulnerable Beneficiary Trusts (for disabled or vulnerable loved ones)

These are usually the trusts that arise in practical estate planning rather than the specialist trusts used primarily for complex tax planning.

Honest Careful Advice.

Trusts can be extremely useful in the right circumstances, but we believe in giving balanced, honest advice rather than recommending them where they're not needed. Some trust arrangements, particularly those marketed as simple solutions for avoiding care fees, may not deliver the benefits people expect and can sometimes create unintended complications.

Our approach is straightforward and transparent. We'll explain what a trust can realistically achieve, where it may be beneficial, and any limitations you should be aware of. If a trust isn't the right solution for your circumstances, we'll tell you so. Our priority is helping you make informed decisions that genuinely serve your family's best interests, not selling products you don't need.

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FREQUENTLY ASKED QUESTIONS

Trusts good to know.

Will a Trust protect my home from care fees

Possibly, but it depends on your individual circumstances. Be cautious of anyone offering guarantees, as no trust can provide a certain outcome in every situation. If assets are transferred into a trust primarily to avoid future care costs, a local authority may regard this as "deliberate deprivation of assets" and take those assets into account when assessing care fee contributions.

Trusts can serve many legitimate estate planning purposes, but it's important to understand what they can realistically achieve. We provide clear, honest advice based on your circumstances, helping you make informed decisions without sales pressure or unrealistic promises.

Are Trusts only for wealthy people?

Not at all. While trusts are often associated with larger estates, they can be just as valuable for ordinary families. Trusts are commonly used to protect a share of the family home, provide for vulnerable loved ones, safeguard a child's inheritance, or help ensure assets remain within the family for future generations.

The key is choosing the right trust for the right reason. We'll take the time to understand your situation and explain which options may be suitable for your family's needs..

What is a Property Protection Trust?

A Property Protection Trust is commonly included within a Will and is designed to protect a person's share of the family home. When the first partner dies, their share of the property is held within the trust, allowing the surviving partner to continue living in the home for the rest of their life.

When the surviving partner later passes away, the deceased partner's share is ultimately distributed to their chosen beneficiaries, often their children. This can provide reassurance that your wishes are respected while continuing to provide security for a surviving spouse or partner.

Can you set up a Trust as part of my Will?

Yes. Many trusts are created within a Will and only come into effect after death. This can be an effective way of protecting assets, providing for loved ones and ensuring your estate is distributed in the way you intend.

We can prepare a Will that includes the most appropriate trust arrangement for your circumstances and explain everything in plain English — including how the trust works, who should act as trustees, and what benefits and limitations you should be aware of. Our aim is to ensure you fully understand your options and feel confident in the decisions you make for your family and your future.