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0191 251 2655

Trusts

When we arrange a protection policy for you such as Life Insurance we will write the policy in Trust where appropriate.

This may sound complicated but it is relatively straightforward to do and we can guide you through the process, indeed we can put policies in Trust for our clients at no additional cost. When you write a policy in Trust, it basically means that you nominate one or more Trustees who will ensure any monies paid out on your death go to the people you wish it to go to. If you don’t write a policy in Trust, the money will go into your estate on your death and be paid out after the estate is settled. The main reasons for writing a policy in Trust are as follows:

Speed – If a policy is on a single life basis, the policy will not pay out until probate (or confirmation in Scotland) is granted on the estate. This can sometimes take time. If the policy had been written in Trust, the funds do not go into your estate and the Trustee can obtain the proceeds immediately.

Tax planning – when a policy which has not been written in Trust the proceeds go into your estate and as a result, depending on the value of the estate the policy proceeds may be subject to inheritance tax. If a policy is written in Trust then the proceeds can be paid directly to the Trustee for the benefit of the beneficiaries without going into your estate & would not usually be subject to inheritance tax.

Certainty – when a Trust is set up you ensure that who you wish to receive the benefits of a policy on your death definitely does. Because the proceeds don’t go into your estate, they are paid directly to the Beneficiaries via the Trustee. This can be extremely important in circumstances where someone may have been married before or have particular wishes for the policy proceeds should they die. You will either be asked to name the Beneficiaries in the Trust deed or give a “Letter of Wishes” to the Trustee so they know who you wish the proceeds to go to on your death.

In summary… :

  • Free
  • Could save your loved ones 40p in every £1
  • Could save months of legal wrangling
  • Potentially avoids inheritance tax
  • Avoids any probate delay

 

Trusts are an important area for you to consider and we at Right Money Solutions are happy to speak to you.

Trusts are not regulated by the Financial Conduct Authority.

Contact us.

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