Written by 12:00 pm Finance

This Is Why You Need A Trust Fund, Experts Suggest

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If you think trust funds are only for the rich, millionaire folks that have plenty of money lying around, you’ve got another thought coming. While it’s still unclear as to how many people in the UK have a real estate plan in their life. Yes, neither a will nor a trust fund will help their close ones in the years to come.

If you’re someone like that and have always regarded trust funds as “something for the privileged”, this guide is for you. Make sure to read till the end, and find out everything you need to know about setting up trust funds!

Explaining Trust Funds

When it comes to financial planning, trust funds are an option that many individuals consider. Essentially, a trust fund is a legal arrangement in which a trustee holds and manages assets for a beneficiary. The trustee is responsible for managing the funds, investing them, and distributing them following the terms established when the trust was created. 

Trust funds are often established to provide for the long-term financial needs of a designated individual or group of individuals. They can also be set up to support charities or organizations. While trust funds may seem like something only the wealthy have, they can be useful for anyone looking to secure and manage their assets in a more structured and secure manner.

So, to sum up, the three key players in setting up a trust fund would be:

  • Grantor: The person who is turning their assets over to the trust
  • Trustee: The decision maker, also termed as the person who is in charge of the trust
  • Beneficiary: The person, or a list of people, that benefit from the trust when name occurrences happen

Need help setting up a trust fund? Head onto services like PMW, and get the best of their advocacy services today!

3 Reasons You Might Need A Trust Fund

Got the gist of what trust funds here? Great. Now, let’s go over some reasons why you might need a trust fund for yourself, and your family.

Taking Care Of Your Children After Death

It’s a terrible thing to happen to anyone’s children to have their parents die, especially when they’re not adults. In that case, setting up a trust fund for your children can help cater to all of their needs even after you’re gone, and ensure that the grantor can stipulate their funds to be given to their beneficiaries, which are the children when they come of age. 

Taking Care Of Individuals With Disabilities

According to various trust-setting experts on the internet, most trust funds are set up when there’s a disabled person, often a child, involved. If you have someone in your family, whether it’s a child, a grandchild or anyone else, setting up a trust fund can help cater to their needs even when you’re not here. 

Getting The Tax Benefits

Because the assets are no longer in any individual’s name after being set up in the trust fund, the grantor is exempt from paying income tax on it, potentially allowing you to lower your taxes during your lifetime. In addition to that, beneficiaries are also not subject to paying taxes they inherit from a trust, which means that even a small amount of money is drastically big after being set up in a trust fund. 

Take Home

Setting up a trust fund might sound like a hassle, but there’s a lot more to it than meets the eye. That’s why we created this insightful guide, letting on-looking readers like you get the gist of what trust funds are all about, and know whether or not setting one up is for you!


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