Trust funds. How do they work?

[sneezecakesmum]

DH and I want to leave half the value of our modest house (mortgage paid off and joint tenants) to our disabled grandson, to be used for uni, housing whatever, in the event of the death of one of us. My daughter will be the trustee.

We have been in touch with a will making company who have suggested this as a way which will work for us, protecting our and his interest.

Any info or websites you can give me to help understand what all the implications are would be appreciated. Would we able to downsize if bereaved or would we need to sell the house and lose half the value? Any pitfalls?

The remaining half could be used for our care in decrepitude old age

My eldest son has a special needs trust. Money in trust will mean that he would still get benefits that are means tested and wouldn't have to use the trust money for his care.

I would recommend you go down that route. Find a solicitor who specialises in sn trusts. You need someone who knows what they are doing.

Also - I recommend a professional trustee along with a family member. You'd of course want to believe that the family wouldn't be using the money in ways not intended, and I'm sure they wouldn't, but it's a layer of protection because you never know what may happen in the future.

I am one of the trustees on my son's fund and his solicitor is the other. Any cheque of any value requires both our signatures.

I am not untrustworthy but I feel it is better this way.

You need to google special needs trusts and spend a lot of time talking to different solicitors. I can recommend mine, but that only helps you if you are within reasonable distance of sheffield / doncaster

Just a point on professional trustees. They do charge, so depending on the value of the fund, it may not be worth it.
Also, what happens when the solicitor retires - does it go to another in the same firm who may have a different mindset?
Agree 2 signatories are best, so DD and family friend, DN etc?

Yes. they do. My son's trust is invested. The growth more than covers the fees and his fund will be worth considerably more over time. We chose a balanced/cautious portfolio, of course, the more risk you are willing to take, the higher the potential gain - but equally, the higher the potential loss.

If you just stick it in a bank account then the costs will eat away at it. It has to be properly invested to make it worthwhile.

Thank you. We have a man coming round to discuss the matter and I will also ask about sn provision. Never though about that aspect. writing wills...what fun...not