Jump to content
House Price Crash Forum

Archived

This topic is now archived and is closed to further replies.

Guest

Opening A Trust Account For Relative

Recommended Posts

Guest

An elderly relative has just passed away and made me executor. All the paperwork is now done, I'm just waiting for the grant of probate to arrive. I did everything without a solicitor to avoid the fees.

The relative has specified that the money intended for her nephew is not given to him outright, but held in "trust". He is middleaged... i.e. not a child. He can then request funds as and when needed, and I will make a decision whether it is for a valid reason or not. E.g. if he asks for £2k for new guttering i can check he needs new guttering. If he asks for £100k for a ferrari I'll say no.

So, I have the money for him, and need to lock it away ready to be dished out as and when fit...

Is there some kind of special bank account I open in my name, but "re" him? What happens if I die, and his money is still in the account.... will there be a note on the account saying what needs to happen to the money?

Do I just get a solicitor involved?

Share this post


Link to post
Share on other sites

Sounds to me like your relative lived longer than expected and so you`re put in the situation of being in charge of the money when there`s no need. (or is he a half wit?).

These things happen.

You should get out of this situation as soon as possible.

Let him buy an Alfa...

Share this post


Link to post
Share on other sites
Guest

The trust account approach was specified in the will. The reason (which was discussed prior to death) is to prevent the beneficiary's new family (through recent re-marriage) get their hands on the money should he himself pass away. Considering his age and health this is a distinct possibility.

Share this post


Link to post
Share on other sites

Depends how much the estate is what your options are. Can you give a range?

Share this post


Link to post
Share on other sites
Guest

It`s all very `Victorian novel` innit?

You couldn't even make it up. The nephew's wife is a loon, utterly off the scale. His ex wife is also a loon, and has various other loony members in fer family too. Thankfully none of the loons are blood relatvies of mine, otherwise I'd be very worried!

Share this post


Link to post
Share on other sites
Guest

I don't get it. can't the executor say he doesn't agree with this?? I mean it could be a huge amount of work acting as the trust holder.

I do agree with the trust approach 100%.... and there will be little work to do as trustee, as the beneficiary can only ask for funds for good reason, i.e. not a few quid here and there.

Share this post


Link to post
Share on other sites

I do agree with the trust approach 100%.... and there will be little work to do as trustee, as the beneficiary can only ask for funds for good reason, i.e. not a few quid here and there.

But what's a good reason??? Does this have to be documented.

I want a BMW motorbike to commute to work as it's slightly cheaper than paying £7.80 a day on the train.

Can I have 10k please?

Who decides whether that is reasonable?

Share this post


Link to post
Share on other sites
Guest

But what's a good reason??? Does this have to be documented.

I want a BMW motorbike to commute to work as it's slightly cheaper than paying £7.80 a day on the train.

Can I have 10k please?

Who decides whether that is reasonable?

The two trustees (me and another relative) decide... when you make someone a trustee of your money, which the deceased did, that is you saying I trust them to make the right decisions. You can provide as much or as little guidance as you want for the trustees.

We will base our decisions on the size of request, what it is for, whether necessity or not, etc etc. It is the same as someone who leaves money in their will to form a charitable trust - people have to apply for funds from it, and the board of trustees assess each application on merit.

Share this post


Link to post
Share on other sites

As trustees, you should be getting fees paid plus some financial benefit, even if small (i.e. 100 quid a year). If you have been asked to be an unpaid trustee, forget it - it is a LOT of work. If that is the case, your first act as trustee should be to appoint a professional trust officer as trustee.

With a small estate of that size, it's probably not worth going to a firm as it would be whittled away in fees. If I was asked to be a trustee, I would be very hesistant unless it was a bigger sum

Share this post


Link to post
Share on other sites

ball park figure... average uk house price.

Is that a RM average or a Nationwide or Halifax average? Is it a London average... Oh, never mind.

I have spoken about this before to a solicitor who advised seeing a financial adviser. I have spoken to a financial adviser who suggested a solicitor. I am still none the wiser.

What I do know though is that you have to be very careful about who administers the trust if you should die - because a solicitor or financial adviser could take most of the money in fees.

I have heard many stories of crooked people in both professions who have bled trust funds dry... but even the good ones could charge punitive fees.

Long term probably putting it in trust into shares would be best if you wanted a long-term game plan.

But you would need to arrange it carefully so you know what becomes of the cash if/when you go to the great HPC in the sky.

Share this post


Link to post
Share on other sites

Is there some kind of special bank account I open in my name, but "re" him? What happens if I die, and his money is still in the account.... will there be a note on the account saying what needs to happen to the money?

IANAL but yes.

What's most important is that there's no right of set-off, i.e. if you were to run up a £10,000 o/d on another account they cannot use the funds in the trust account to repay that.

Share this post


Link to post
Share on other sites

The trust account approach was specified in the will. The reason (which was discussed prior to death) is to prevent the beneficiary's new family (through recent re-marriage) get their hands on the money should he himself pass away. Considering his age and health this is a distinct possibility.

So where does it go if he dies now whilst it's in trust?

Share this post


Link to post
Share on other sites

Who makes investment decisions while it's in trust? Can he ask to put it all into gold miners? Or must you decide to put in on a ftse tracker? Or must it just sit on deposit accruing 0.1% interest? Is a rental property a reasonable request?

Christ this sounds like a complete minefield.

Share this post


Link to post
Share on other sites

I know a thing or two about trusts. Nightmare. Run a mile.

Not that your rellie's plan will work. For various reasons. Look up Saunders and Vautier.

Share this post


Link to post
Share on other sites

  • Recently Browsing   0 members

    No registered users viewing this page.

  • The Prime Minister stated that there were three Brexit options available to the UK:   212 members have voted

    1. 1. Which of the Prime Minister's options would you choose?


      • Leave with the negotiated deal
      • Remain
      • Leave with no deal

    Please sign in or register to vote in this poll. View topic


×

Important Information

We have placed cookies on your device to help make this website better. You can adjust your cookie settings, otherwise we'll assume you're okay to continue.