Money in Trust for daughters - where to put it

camellia2015

hi, this is my first post

My daughters age 16 and 18 have been left £10,000 each, this is to be in trust for them until they reach the age of 23. whilst they are not children, i need to put this somewhere safe and hopefully earn a little bit of interest for them until then.

my solicitor has advised national savings certificates but is there anything better? and he said keeping it tax free is a good idea as it could get complicated.

thank you

TBagpuss

7 and 5 years are relatively short periods for investment - it sounds as though you've been advised to invest in a way which is very low risk, which is reasonable given the short length of the investment and the fact that you are investing as a trustee.

it might be worth talking to a financial advisor about options. Most solicitors are not qualified to offer investment advice.

xylophone

Is this a contingent trust - "if and when they reach the age of 23"?

Or has the gift vested now so that the money is theirs absolutely now but they are not to be able to spend the money until the age of 23?

http://www.cltint.com/attachments/Administration%20of%20Estates%20-%20Replacement%20Pgs.%2048and49.pdf

What type of trust is it? You might check this with the solicitor? You need to know the type to establish the tax position.

http://webarchive.nationalarchives.gov.uk/+/http://www.hmrc.gov.uk/trusts/introduction.htm

xylophone

my solicitor has advised national savings certificates but is there anything better? and he said keeping it tax free is a good idea as it could get complicated.

There are no National Savings Certificates available for purchase at the moment.

camellia2015

ok thank you for that! he must be a bit out of touch!

i think the low risk or no risk is absolutely right! i'd hate to lose any for them and have to answer for that!

ive been told it should be in my name and becomes theirs at 23, does that help?

where can i find a financial adviser who will give impartial advice thats best for me, not his company or his pocket? i dont mind paying a fee if its absolutely impartial.

xylophone

What exactly does the will say?

This looks like a small A&M Trust but the solicitor should advise.

If it is an A&M Trust then there is the tax position to consider.

£20,000 is a rather small amount for an IFA - you (or the Trust) would have to pay for the advice.

http://www.nwbrown.co.uk/news/child-trust-funds/

https://www.unbiased.co.uk/

camellia2015

Have looked out my copy of the will, and it says:

for ................... conditional upon her attaining the age of twenty three years


thank you for your help

xylophone

for ................... conditional upon her attaining the age of twenty three years

I am no expert but I think that you are going to have to discuss this with the solicitor as the will appears to have created a "contingent pecuniary legacy"?

See http://www.lawskills.co.uk/articles/2010/01/the-nutty-problem-of-contingent-pecuniary-legacies/

kidmugsy

If it were permissible, I'd consider an option that would keep the capital safe and avoid tax complications - Premium Bonds.

But I understand that Trusts aren't allowed to buy them. So, as x says, it's back to the lawyer to get clarification.


P.S. Trusts were allowed to buy Savings Certificates when those were still on sale.

camellia2015

thank you, i will refer back to the solicitor.