The family home is often your major asset, which you hope to pass to the family.
Yet you probably know how your house plus most of your savings could disappear before
your family can inherit - perhaps because some unscrupulous person takes advantage
of us in our vulnerable old age, or you leave it all to your spouse who later remarries
and then their new partner takes it all. In other cases, you leave it to your spouse,
but then their fees for residential care use up everything they have inherited from
you. However, there are ways you can protect some (or indeed nearly all) of the family’s
inheritance - and even save the family money in the long term.
Property Trust Will
Anyone (whether married or not) can use their Will to leave assets in ‘Trust’. For
example, rather than simply leaving your share of the house to a spouse/partner it
could go into a Property Trust. The exact terms of the Trust will be specific to
your instructions, but usually they allow your partner to carry on living in your
share of the family home just as if they owned the whole property. Normally this
includes being able to sell the house and buy a replacement in the usual way.
However, your partner never actually owns your share of the house. So they can only
use their own share for whatever they wish - be that blowing it all on world cruises,
or giving it to a new spouse/partner or indeed having to spend it on their own residential
care. Your share of the house is still owned by the Trust, protected according to
the terms you specified and typically ensuring that it eventually it passes to your
Having this type of Will can mean that when the first member of a couple passes away
the family should obtain a grant of probate even though otherwise it would not be
needed. If so this creates an extra probate cost - but in the longer term when the
second member of the couple passes away the probate costs at that time might be much
reduced, saving the family money overall.
Lifetime Family Protection Trust
With a lifetime Family Protection Trust (FPT) you can provide some protection for
all your major assets (not just your house) during your lifetime. The trust operates
straight away, unlike a Will which has to wait until you die before any protection
can apply. The trust can include you as a beneficiary and you can remain in control
of the trust - but if you lose your mental capacity the other trustees can still
manage the trust assets for you. When eventually you pass away your family might
avoid probate with its delays and increasing costs - a useful benefit potentially
saving your family many thousands of pounds. However what is more important is that
the assets pass to the family under the continuing protection of a trust, helping
future generations for up to a total of 125 years! It is a very powerful solution
- please contact us so that we can explain the details to you. But be clear, under
the rules that now apply such a trust does not guarantee protecting your assets against
having to be used to pay your own care fees.
Using trusts is becoming increasingly common practice and InHouse can arrange this
for you. We also check the details of how your house is owned, in case Severance
of Tenancy is required to change from Joint Tenants to Tenants in Common so as to
make your Will effective. But do be clear, it is not ‘tenants in common’ that protects
your house, it is having a proper Will or a lifetime trust that delivers the protection.
We can also consider your inheritance tax situation, so that you are aware of the
pitfalls whilst allowing your family to perhaps have a better inheritance tax situation
in the longer term.
Protecting the family home
You’ve worked hard all your life, saved what you can and invested in a house. You
want to be sure that as much as possible will pass to your family - and you can do
that with a Property Trust in your Will a lifetime Family Trust.