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Lack of trustees for a Trust

including wills and probate
ntl2000
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Lack of trustees for a Trust

#24368

Postby ntl2000 » January 19th, 2017, 10:00 am

Okay, without going in to a full life history my situation is this.

Late fifties, no children, partner 10 years younger, not mega rich but sufficient assets to have the prospect of HMRC taking very substantial amounts of IHT if I were to kick the bucket tomorrow. Marriage may be on the cards after quite a wild life of trying to avoid it!

Looking to set up a discretionary or lifetime trust to look after my partner/wife to be after my death with the second priority being that the assets (which are currently 99.5% mine) find their way back to my relatives at the end of the day. She has no relatives to speak of and the nightmare scenario would be a distant and estranged niece of hers getting anything after her death.

My closest relatives are nephews, late twenties and nearly all working/travelling abroad. Good relationship with all of them but not sure it would be right or fair to ask any of them to be trustees. No other younger friends or relatives who I feel would do the job.

So, finally, the question. If I am struggling to find anyone am I being a fool to appoint a law firm as sole trustees? How could they be monitored. My partner has zero financial sense or knowledge and would probably write out a cheque for any sob story that came along, another reason for leaving the money in trust.

Thanks and regards to all.

melonfool
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Re: Lack of trustees for a Trust

#24391

Postby melonfool » January 19th, 2017, 10:45 am

Hmmm.

Not what you asked but why not leave her half and leave the other half to your family (split between them whichever way) and let her do as she wishes with what she gets, including writing cheques to sob stories if it floats her boat?

Can't your siblings be trustees, or are they too old? Or in-laws?

I have a good friend as one trustee and a child's (my godson) parent as another.

Mel

rgifford
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Re: Lack of trustees for a Trust

#24550

Postby rgifford » January 19th, 2017, 8:56 pm

ntl2000 wrote:and the nightmare scenario would be a distant and estranged niece of hers getting anything after her death.


What if your wife wanted to remarry? Not too unlikely if she is 10 years younger than you.

Lootman
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Re: Lack of trustees for a Trust

#24553

Postby Lootman » January 19th, 2017, 9:08 pm

rgifford wrote:
ntl2000 wrote:and the nightmare scenario would be a distant and estranged niece of hers getting anything after her death.

What if your wife wanted to remarry? Not too unlikely if she is 10 years younger than you.

Alimony stops if an ex-spouse remarries. Can a trust not make the same stipulation?

Clitheroekid
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Re: Lack of trustees for a Trust

#25080

Postby Clitheroekid » January 21st, 2017, 10:22 pm

ntl2000 wrote:If I am struggling to find anyone am I being a fool to appoint a law firm as sole trustees? How could they be monitored.

This is an increasingly common problem, as there are a lot more single people and a lot of them are wealthy. It's also common for people to have problems selecting trustees. After all, even people who are quite close friends and family are unlikely to want the responsibility, particularly if, to be blunt, there's nowt in it for them!

Being a trustee in this situation can be quite stressful, as if your Will does set up a discretionary trust with several beneficiaries the trustees will be subject to competing demands from the beneficiaries, and may have to make decisions that are unpopular.

So if you can't find any friends / relatives who are both willing and (just as important) competent to take the job on you really have no option but to appoint professionals to deal with it.

The trustees don't have to be solicitors. Many accountancy firms will take on such appointments, and you can also appoint a `trust corporation' such as a bank, though their charges tend to be outrageously expensive, even compared to the top firms of solicitors / accountants.

All professionals are subject to professional rules restricting what they can charge, though these are often difficult to enforce. But there’s nothing to stop you negotiating fees with the professionals, and you may be able to limit the fees in some way, for example as a percentage of the estate, or £x per year + inflation.

But professional relationships should be based on trust as much as contract, and as always word of mouth is the best way of finding someone trustworthy and competent, who won’t rip you off. In general the larger the firm the higher the costs, and firms in cities tend to charge more than those in the sticks.

One possible solution would be to appoint a trustee who is a friend / relative but provide in your will that they can be paid. Normally a lay trustee can only recover reasonable expenses, but there's nothing to stop you specifying that they can be paid for the time spent in dealing with trust matters. This would possibly enable you to introduce a trustee who (a) knew you personally and understood what you would want to achieve; and (b) could keep an eye on the level of charges being made (assuming they were appointed alongside professional trustees).

Hopefully, the amount they were paid would be more than compensated for by a reduction in the bill from the professional trustees.

Finally, bear in mind that marriage revokes a Will, so be sure to tell the solicitor preparing your Will that you are getting married so this problem can be avoided.

ntl2000
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Re: Lack of trustees for a Trust

#25646

Postby ntl2000 » January 24th, 2017, 11:13 am

Thanks for taking the time to reply Clitheroekid and interested to learn it is becoming increasingly common as I was beginning to feel like Billy no mates!

Certainly a worry, sadly, that needs further thought.

Cheers.


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