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Why You Should Use a Trust
When it comes to financial planning, a trust can be a very useful and effective way of ensuring your loved ones receive your wealth when you are gone. While many people are sceptical about trusts, there is no need to be because they serve a real purpose and are an extremely useful way of protecting your wealth.
While many people consider trusts to be for the rich and wealthy, that could not be further from the truth. If you have worked hard all your life and you have savings and assets, then a trust could be for you.
Avoid the Complex Family Arrangements
It is a sad but true fact that around 40% of marriages will end up in divorce and sadly, there are children who get caught up in it all. What is a concern to many is what happens to their money when they pass away as many will want it to pass to their children. However, without the use of trusts and the correct financial planning, it could mean that your wealth gets passed to the wrong people and in the wrong way. Financial planning forms part of your estate planning and so, the use of trusts ensures that your wealth is distributed accordingly and does not end up on the wrong hands.
Your Wealth isn’t Left to Chance
Your wealth and financial security have been important to you throughout your life, so why should that change when you die? If you fail to plan your wealth in the right way, then it will not pass through the generations but distributing it and managing it is not as easy as arranging many other financial aspects of our lives. If you opt to use a trust, then you remove the complications and you make sure that nothing is left to chance.
It is a Form of Tax Planning
In the 2017/2018 financial year, over £5 billion of inheritance tax was collected by HMRC. The truth is, property prices have increased considerably in recent years and so, there are many people out there who are considered asset wealthy. Inheritance tax is something that affects many families and so, more people are seeking ways in which they can reduce the amount they pay. A trust can help to reduce or avoid the amount of inheritance tax that is paid, ensuring that the full extent of your wealth is passed on to your loved ones.