News & Events
A Bloodline Trust Can Ensure Your Children and Grandchildren Inherit Your Wealth
- Posted by: curtislegalwp
- Category: News
If you have been considering making a Will, you may be wondering how you can make sure that your children (and in turn their children) are the only beneficiaries. You may not be aware that when you make an ordinary or standard Will, other people other than those you name in the Will may eventually benefit from whatever you have left in it. Examples might include any of the following:
- an ex daughter-in-law or son-in-law;
- children’s creditors;
- a court order;
- future new stepparents to your grandchildren;
- someone else’s grandchildren;
- Inland Revenue.
One solution is to set up what is called a bloodline trust. A bloodline trust is basically a trust set up within a Will, which ensures that the funds you want your children or grandchildren to inherit (your bloodline) go only to them and cannot be passed on to anyone else, such as a son or daughter in law or the Family court in the event of a dispute, a creditor or the HMRC.
Who are the trustees in a bloodline trust?
Normally, the trustees will be your children, or one of your children who is named in the Will. In certain circumstances, a co-trustee may also be designated. One example would be if your child is the trustee and is about to go through a divorce or lawsuit, then the trusteeship can be transferred to someone else, until the divorce or lawsuit is over.
As trustees, your children are perfectly in their rights to dispose of the assets after your death in any way they like. What cannot happen is for the funds that are contained in the trust to be divided between your child and their spouse if they decide to separate or become divorced. This is what could happen in a normal Will when the funds after inheritance may become co-mingled, i.e. regarded as being the common property of both spouses.
Similarly, if one of your children is a trustee, but becomes bankrupt or owes a large sum of money to a creditor or as tax, the funds contained within the bloodline trust cannot be used to pay the debt.
Bloodline Wills take the uncertainty out of inheritance
On the death of your children, any funds remaining in the bloodline trust will go directly to their own children following the bloodline. This means that a surviving spouse who then goes on to marry someone else and has children of their own cannot be a beneficiary. The assets in the trust are preserved solely for the children and grandchildren of the testator.
One of the benefits of a bloodline trust is that it ensures that your children have certainty about their role as beneficiaries. Disputes over inheritance can become acrimonious and lead to expensive legal action and a lot of heart ache. If you intend leaving your funds to your direct descendants, a bloodline trust is a sensible solution.