We often get asked by clients “do I need a family trust?” Family trusts are still fantastic concepts to protect your valuable family assets; but only if you know why you need a trust and understand how it will work for you.

Many people do not understand the benefits of having a family trust. We often get told, “my neighbours have a family trust and told me I need one.” Many also consider the administration of trusts laborious and expensive, “do we really have to have a meeting every time we borrow more money from the bank?” But the biggest issue we face with family trusts is the core concept – assets are transferred to trustees to be held for the benefit of another. This is often misunderstood and too many settlors, the persons setting up the trust, try to retain control over the assets as if they were never transferred to the trustees in the first place.

There are two situations that warrant going to the effort and expense of setting up a family trust – either you own your own business and need to protect your family assets from any liability incurred during the course of business, or you have a merged family. Merged families are common today as more and more people have second and third marriages or relationships, and families from a prior marriage or relationship are merged. This results in the need for family assets to be either be protected for future generations from any relationship property claim or protected for a spouse or partner from any family protection claim made by the children of the deceased spouse or partner.

For more information about family trusts, please contact the office.