Vulnerable persons Trusts
Vulnerable persons trusts, also known as vulnerable/ disabled persons discretionary trusts are an effective way of managing a legacy for a child or family member who may not be able to manage that money themselves.
If a person has physical disabilities or learning dificulties such as Ausistic Spectrum Condition (ASC), the legacy they recieved could have a negative impact rather than a positive. That legacy may stop them recieving benefits that they rely on or be at risk of missmanagement.
In January this year, Moneybox Wills & Trusts delivered a number of talks at Macclesfield based charity Space4Autism. The parent/ carers who attended all had children living with ASC. Firstly, all expressed concerns that their estate would be missmanaged or put their children at risk of financial abuse in some instances.
A common concern was that their children would not be able to mamage their day to day finances. And that a sudden increase in wealth, like an inheritance may actually have a negative effect. Or that legacy may not be used in the way you had intended.
These parents are able to use a vulnerable persons trust to control that legacy. As a result, this ensures that any means tested benefits were retained. Moreover, the legacy could be used in a supportive and enriching way throughout the lifetime of the beneficiary.
If a person had a history of alcohol or substance abuse, recieving a legacy in this way may, in fact, further that habit and cause substantial harm. Because a legacy directly to them cannot be controled or incluenced. For esample, that person may use the legacy to buy more alcohol.
In conclusion, Discretionary trusts enable this person to benefit in a way that would support them in their individual and ever changing circumstances. Additionally, trustees could delay their inheritance until the situation had improved.
Finally, If you have a family member living in challenging curcumstances, arrange a free consultation with a qualified member of the team. Find out how a vulnerable persons trust could help.
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