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Life insurance policy arrived
Denzal
Posts: 8 Forumite
Hello,
My mother's life insurance policy has recently been paid out to us. It's quite a substantial amount. It is to be split equally between me and my sister.
My question is: What would be the best option for me to use to keep this money secure for my sister? It is about £10,000, and I would like to put it somewhere where she would not be able to access it until she's at least 18 (this would hopefully be her college/university fund)
I was thinking maybe some sort of trust fund, but I'm not sure if it's possible to open one without an actual voucher (if it is, then I would love to). She is 10 years old currently, so I'm not entirely sure what options are open to me.
Any help on the matter would be hugely appreciated.
My mother's life insurance policy has recently been paid out to us. It's quite a substantial amount. It is to be split equally between me and my sister.
My question is: What would be the best option for me to use to keep this money secure for my sister? It is about £10,000, and I would like to put it somewhere where she would not be able to access it until she's at least 18 (this would hopefully be her college/university fund)
I was thinking maybe some sort of trust fund, but I'm not sure if it's possible to open one without an actual voucher (if it is, then I would love to). She is 10 years old currently, so I'm not entirely sure what options are open to me.
Any help on the matter would be hugely appreciated.
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Comments
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I was thinking maybe some sort of trust fund, but I'm not sure if it's possible to open one without an actual voucher (if it is, then I would love to). She is 10 years old currently, so I'm not entirely sure what options are open to me.
Holding it under trust is logical as she is the legal beneficiary and most other methods would put the ownership under the person who holds the investments.
Dont mix up the childrens trust fund (CTF) with trust based investments.
Normally in these cases, the type of trust would depend on what is stated the in the Will. The most common trust used would be a Will Trust. So, the investment would be held as "The Will Trust of sisters name"
You say you want the money secure. What is your definition of secure? Are you going to be one of the trustees?I am an Independent Financial Adviser (IFA). The comments I make are just my opinion and are for discussion purposes only. They are not financial advice and you should not treat them as such. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.0 -
Holding it under trust is logical as she is the legal beneficiary and most other methods would put the ownership under the person who holds the investments.
Dont mix up the childrens trust fund (CTF) with trust based investments.
Normally in these cases, the type of trust would depend on what is stated the in the Will. The most common trust used would be a Will Trust. So, the investment would be held as "The Will Trust of sisters name"
You say you want the money secure. What is your definition of secure? Are you going to be one of the trustees?
Unfortunately there was no specific type of trust stated in the will. The only thing that was mentioned in the will was that the money was to be invested in "the purchase of or at interest upon security of such stocks fund shares securities or other investments or freehold land or leasehold property of whatsoever nature of wheresoever situate (and whether for the purpose of producing income or for the purpose of personal occupation and enjoyment by any beneficiary) as my Trustees in their absolute discretion shall think fit to the intent that my Trustees shall have the same full and unrestricted powers of investment and transposing investments in all respects as absolute beneficial owners"
I don't particularly speak legalese, but from what I can tell it's saying that I, as her Trustee, can invest the money how I see fit. I'd pretty much like a tax-free savings solution for my sister, really. As I understand it, CTFs are being phased out in favour of Junior ISAs but that will not be until november. Would it be worth holding on to the money until then and then placing it in a Junior ISA, or would I be better suited to find a trust savings account now?
Apologies for my ignorance on the subject. The money being paid out this soon was rather shocking to me and I don't really want to sit on it for too long.0 -
I've been looking into my options on the directgov website, and read about Children's Bonus Bonds.
Would it be possible to buy multiple bonds? i.e. 3 bonds of £3,000 each for a total of £9,000 and would this be a better option than putting it into a savings account?0
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