Has the time come for you to think about setting up a family trust for your family? What should you know about this trust? Make sure to read this article if you are considering setting up this trust for your family. Carry on reading on below to learn more.
Here is some beneficial information for you.
A family trust is a trust that is created especially for the benefit of members of a certain family. It is set up in order to protect and manage family assets for existing and/or future generations. You can set up this trust to benefit your family members.
Now that you know more about this trust, what else should you keep in mind?
What are the advantages of a family trust?
If you are considering setting up this trust, there are some essential points that you need to take into consideration:
- This trust can be utilized to provide for your children or for other family members who need medical care.
- These trusts can also protect against spendthrift beneficiaries. Do you have a spendthrift child? Your spendthrift child will have access to income but he will not have access to a big capital sum which he can spend fast.
- You may want to set up this trust to put aside money for particular reasons, like your child’s education.
- These trusts can also be helpful in making sure that your children keep their inheritances.
What are the disadvantages of a family trust?
You may be curious about the disadvantages of this trust.
Here are the disadvantages:
- Costs are involved for creating and maintaining the trust.
- It might be hard to run the trust when there are family disputes that occur.
It is important for you to be aware of the advantages and disadvantages of this trust. You can decide if you would like to set up this trust for your family. Weigh up the advantages and disadvantages and make the right decision for your family.
DR MERVIN MESSIAS
JD (Juris Doctor) / BA, LLB (Wits) / TEP (Trust & Estate Practitioner) / MTP (Master Tax Practitioner – S.A)