Will Trusts 

In this section we cover:

How a Will Trust helps protect assets from outside threats, divorce protection, generational Inheritance Tax, but also Lifetime Trusts and how they can be set up and how they can be useful. 

A Will Trust is a special arrangement set up in your Will that allows you to control how your money, property, or other assets are managed and passed on after you die. If you’ve ever wondered, “what is a Will Trust?”, think of it as a way to protect your estate and make sure your loved ones benefit exactly how you intend.

Unlike a simple Will, which just distributes your assets outright, a Will Trust allows you to place your assets into a trust, managed by a trustee, until certain conditions are met. This could be until your children reach a certain age, a family member finishes school, or even over a longer period to provide ongoing support. The trustees - trusted friends, family members, or a professional – looks after the assets and distributes them according to your instructions.

Protecting Vulnerable Beneficiaries

In a similar manner to a Lifetime Trust, one of the biggest advantages of a Will Trust is its protective element. It ensures that vulnerable family members, such as minor children, vulnerable adults, or those on means tested state benefits, are looked after in a way you choose. For example, rather than giving a child a large lump sum at 18, which they might not be ready to manage, a Will Trust can release funds gradually, helping them cover education, living costs, or even major life events safely.

Similarly, a Will Trust can protect beneficiaries who might face financial challenges or are at risk of losing their inheritance through divorce, debt, or other claims. By keeping assets in a trust, you add a layer of security, ensuring that the money is used as you intended rather than being at risk.

Protection from External Risks

A Will Trust also offers protection from outside pressures. For example, if a beneficiary has creditors, a trust can shield the assets from being claimed to settle debts. In certain cases, it can also provide protection against claims from being caught up in divorce settlements or other legal disputes, which might otherwise reduce what your family receives.  Set up correctly, a Wil Trust can also protect against care home fees.

Protection from External Risks

Assets passed onto a Beneficiary directly inevitably form part of their own estate and will, if not spent, become subject to inheritance tax.  This is known as Generational Inheritance Tax and is where assets either push a Beneficiary's estate over the tax threshold or add to an already taxable estate.  Assets passed to a Will Trust can still be accessed by the Beneficiary, but can be passed on as a loan (interest free) that is only ever repayable on death. 

Control and Flexibility

Beyond protection, a Will Trust gives you control. You can specify exactly how and when your assets are used, and even include conditions for distribution, such as completing education or reaching a particular milestone. This control ensures your beneficiaries are supported responsibly, and can prevent disputes among family members who might otherwise disagree about what should happen.

Peace of Mind

Ultimately, the protective elements of a Will Trust give you peace of mind. Knowing that your loved ones are cared for, that your assets are secure, and that your instructions are followed exactly can make estate planning feel less daunting.

In short, a Will Trust is more than just a way to pass on assets - it’s a powerful tool to protect your loved ones, control how they benefit, and secure their future in a thoughtful, responsible way and shouldn't cost more than about £500 to put in place (including the Will).

If you have a Will already and would like to assess whether it is going to meet your needs please do try our Will Robustness & Risk Scorecard - you'll be able to get a straightforward and plain-talking appraisal of whether your Will is enough, or if a Will Trust might work better for you - just click here to start your FREE review.

    Protecting Assets for Threats     Divorce Protection     Generational IHT Protection     Lifetime Trusts