What is a Family Protection Trust and how can I protect my assets?

Although your Will is the first key step to successfully planning for later life, a Family Protection Trust is a helpful addition designed to provide legal protection for your home and your savings. A  Trust allows you to leave more to your loved ones, and by placing your assets (property and possessions) into a Family Protection Trust helps to protect them and ultimately save your family time and unnecessary stress at an already emotional time in years to come.   

How can I protect my property and savings for my children?

A common misconception with Wills is that your home and savings will automatically be given to your relatives and close friends as per your wishes. However, although you may have specified this in your Will, this isn’t always possible due to external factors such as high probate fees or complex family circumstances meaning anyone can contest a Will or potentially be disinherited due to sideways disinheritance. Although it is still important to document your wishes in you Will, by placing your home and savings into a Family Protection Trust, you have total control.

In the past, many people have transferred ownership of their homes to their children whilst they are still living, however there are a few drawbacks with transferring ownership of your property to a family member. Namely they may have to pay Capital Gains Tax if they go on to sell the property as a result. Additionally, if you have a disagreement with the person or indeed if they become bankrupt, as they are the legal owners, you could run the risk of losing your home entirely. This is why we suggest a Family Protection Trust to secure your property and savings for your family in the future.

What is a Family Protection Trust?

The best way to think about a Family Protection Trust is to think of a safety deposit box where your property and savings will essentially be ‘stored’. By placing your home and savings within a Trust, this ensures that after your death, they will be given to the family members you specified both within your Trust and also within your Will.

Essentially, with a Family Trust, you transfer your property and savings so that legally, the Trust owns them however you still remain in full control and have the ability to add or remove items as you see fit. For example, if you had £5,000 of life savings in your Family Protection Trust, and you choose to take out £2,000 to make home improvements or take a holiday, this is possible.

Benefits of a Family Protection Trust

Protect against large Probate bills: there are few things in life as stressful as losing a loved one however this pain and stress can often be made worse by legal matters you have to address such as probate. In simple terms, probate is the process of dealing with someone’s money, possessions and final wishes after they die and by placing your property and savings into a Family Protection Trust, you protect against Probate.  In fact, with a Family Protection Trust from Golden Charter, you avoid Probate fees up to 5% of your estates value.

Additional benefits include:

  • Your Will remains in force according to your wishes and you can update or change it at any time.
  • Protects against children being disinherited due to remarriage.
  • You remain in control. You can continue to use your assets as you normally would for example you can easily move home or invest your money as you wish.

From buying your first home to thinking about retirement, there are many important decisions to make throughout your life when planning for the future. You don’t need to do that alone. We are there to help you every step of the way and help you decide which products are best for you. All of our legal services products are tailored to you and we offer a free, no-obligation home visit from one of our estate planning consultants, local to you. Find out more about our Family Protection Trust and read our customer case studies here.