How much to live on

Roger175

Organgrinder said:

Indeed. Hasn't deleted his account this time, just all posts in this part of the forum.

I appear to be seeing all his posts, just as 'Deleted user'. 

Sorry you feel you had to do this BD, do look after yourself and hope to see you back some time.

helensbiggestfan

Putting a life policy in trust costs nothing to set up and they normally pay out funds very quickly.  Anyone can do this, it's just a simple form.  You don't need to be a legal eagle. When my husband died i applied to the Insurance Company on the Monday and received a cheque on the Friday. 

 A deceased's bank account will usually be frozen immediately.  Imagine a scenario where dependents have no access to funds. In such cases a life policy written in trust will be an absolute godsend.  

When my father died, as he was the survivor  mum having died two years previously, finalising his estate was delayed whilst the solicitor had to confirm whether or not probate was required.  In the end it wasn't but there were still delays.  My dad at that point lived with my sister who although helping him manage his affairs was not a signee on his bank accounts. Being a spendthrift, bless her, she was thrown into a state of panic because she had no money to cover all the inevitable expenses. Luckily she had me, boring big sister Capable Kate, to pay for everything upfront.  My sister was acutely embarrassed and deeply ashamed, feeling that she had let dad down.  If he had put his life policy in trust all that hassle could have been avoided.  

Btw. I only know this stuff because I once worked for an insurance company in their Life Department.  Both my professional experience and my own personal dealings with three estates have  taught me that trying to navigate bereavement is bad enough without having the added stress of no access to funds.  

My advice to anyone is to ensure that you make adequate provision for your family to tide them over whilst your estate is being wound up, especially if you are the remaining survivor and it is likely to be necessary for your will to go to probate. It's the last great act of kindness you can do for them.....that and decluttering some of your treasures.   

I do agree that trusts can be complicated but "old money" use them for a good reason......to build and protect generational wealth.  One should definitely seek good professional advice.  But then I think that applies to most financial/legal matters. Paying for professional advice can not only reap financial dividends it can also help avoid a lot of unnecessary heartache.  

Solicitors just love it when people don't leave clear concise watertight wills or put their affairs in order. They make a lot of money sorting out the mess.  

barnstar2077

helensbiggestfan said:

Yes children do change. Or at least they should, hopefully maturing and becoming wiser in the process.  That's why late teens and twenty somethings still need guidance and mentoring. (Assuming of course that they are open minded enough to be receptive to advice.   Some young people can be very closed minded).  

Anything I leave my grandchildren will be written in trust until they are 30.  

Why 30??  Because as I mentioned earlier it is the pre frontal cortex part of our brain that is responsible for reasoning, decision making etc. This does not fully develop until around the age of 25, sometimes slightly later in males.  

Of course age is no absolute guarantee of wisdom, maturity and the ability to make sensible financial delusions. lol. Plenty of middle aged people burn through money...... but at least we can protect our offspring by a judicious use of trusts for when they are at their most vulnerable.  

I may have mentioned this before but when taking out life insurance one should always have the policy written in trust.  This way the money bypasses the estate and the funds can be paid out to the beneficiaries with minimum delay. This can be extremely beneficial when probate is required.  

When I was 21 my grandfather passed away, leaving me some money that I could only access at age 25.  It was £9k (a significant sum even today), and I know if I had received it at 21 I would have wasted it on things that I considered very important at the time, like Hi - Fi separates and the latest computer parts for gaming!

As it happened I had just bought a house the year before and was very grateful to be able to pay the £9k straight off of my balance, approximately 15% of the outstanding sum.

Which is why I am such a proponent of helping children to get onto the property ladder earlier.  I would still be in great financial shape if I had not had the inheritance (purely because you were able to buy houses much easier when I bought mine), but it certainly cemented me heading in the right direction and gave me a substantial buffer, and therefore peace of mind.

Organgrinder

Roger175 said:

Organgrinder said:

Indeed. Hasn't deleted his account this time, just all posts in this part of the forum.

I appear to be seeing all his posts, just as 'Deleted user'. 

Sorry you feel you had to do this BD, do look after yourself and hope to see you back some time.

That account has indeed been deleted. No this time he is posting as Lord Mattenly, albeit he claimed he was a newbie. It doesn't take a rocket scientist to work out they are one and the same. But he's deleted around 45 posts on here which personally I find rather strange. But each unto their own.

helensbiggestfan

Your Grandfather was a wise man.....j😉

helensbiggestfan

sorry to see you go LM.  Hope all is well.  

Well now must crack on..,..,need to do some more decluttering and pack a few more boxes.  

Albermarle

helensbiggestfan said:

Putting a life policy in trust costs nothing to set up and they normally pay out funds very quickly.  Anyone can do this, it's just a simple form.  You don't need to be a legal eagle. When my husband died i applied to the Insurance Company on the Monday and received a cheque on the Friday. 

 A deceased's bank account will usually be frozen immediately.  Imagine a scenario where dependents have no access to funds. In such cases a life policy written in trust will be an absolute godsend.  

When my father died, as he was the survivor  mum having died two years previously, finalising his estate was delayed whilst the solicitor had to confirm whether or not probate was required.  In the end it wasn't but there were still delays.  My dad at that point lived with my sister who although helping him manage his affairs was not a signee on his bank accounts. Being a spendthrift, bless her, she was thrown into a state of panic because she had no money to cover all the inevitable expenses. Luckily she had me, boring big sister Capable Kate, to pay for everything upfront.  My sister was acutely embarrassed and deeply ashamed, feeling that she had let dad down.  If he had put his life policy in trust all that hassle could have been avoided.  

Btw. I only know this stuff because I once worked for an insurance company in their Life Department.  Both my professional experience and my own personal dealings with three estates have  taught me that trying to navigate bereavement is bad enough without having the added stress of no access to funds.  

My advice to anyone is to ensure that you make adequate provision for your family to tide them over whilst your estate is being wound up, especially if you are the remaining survivor and it is likely to be necessary for your will to go to probate. It's the last great act of kindness you can do for them.....that and decluttering some of your treasures.   

I do agree that trusts can be complicated but "old money" use them for a good reason......to build and protect generational wealth.  One should definitely seek good professional advice.  But then I think that applies to most financial/legal matters. Paying for professional advice can not only reap financial dividends it can also help avoid a lot of unnecessary heartache.  

Solicitors just love it when people don't leave clear concise watertight wills or put their affairs in order. They make a lot of money sorting out the mess.  

I am sure you are right about life policies, I was thinking more about discretionary trusts etc .
My understanding is that they more come into their own more for people with multi Millions, and can be more hassle than they are worth for the more modestly wealthy/mass affluent.

Organgrinder

When an aunt passed about 15 years ago she had about £300,000 in trust funds. To get the money out all 8 beneficiaries had to agree and even then the fund manager made it unbelievably difficult.

But, it did avoid a fair bit of tax as she left another £400,000 plus a house. 

As for my own plans this year. This morning I set my budget for the year. No increases in planned expenditure save for an expected rise in Council Tax. Any impact on food prices will just be absorbed in my monthly budget.

I usually keep a very close eye on finances but was somewhat shocked that my current stooze is now £23k (I probably posted that exact amount previously but had forgotten). It means it's earning over £1,000 a year in interest which I'm very pleased with. It's projected to reach £31k by September when I either have to switch £15k to other cards or pay them off. Fingers crossed for more fee free balance transfer offers.

On the holiday front we've two booked for Easter and August.

And am currently awaiting a response from easyJet with regard a flight delay. I'm pretty certain they'll blame the weather and do anything to wriggle out of paying compensation but it's worth a punt!!

helensbiggestfan

From little acorns, do mighty oaks grow.!!!  You have to start somewhere.  

There is an other saying.  From Clogs to Clogs in three generations.  (Clogs were worn by the working classes who worked in factories and the mills). 

Basically what it means is the first generation builds wealth, the second generation spends it, the third generation is back to square one.  My view is, if setting up trusts can help preserve some of that wealth and possibly increase it, then they are worth looking at.  They won't be appropriate for everyone but I wouldn't just dismiss them out of hand, they come in many guises.  

Taking my parents as first generation. They were ordinary average working class people who worked hard and managed to scrape enough money to buy a small house. The first in their families to own property.   They left this to my sister and I.  Thankfully my parents enjoyed long lives so that by the time they died my sister and I already owned our properties so our inheritance was a bonus. She frittered hers away, I ploughed mine into my property.  

She lives above her means and is constantly in debt. I live below my means, have no debts and some savings and assets. Certainly not wealthy (yet!!!!). Working on it. Lol. My sister hasn't been able to help her only daughter get on the housing ladder who is stuck in a grotty flat she can barely afford to rent,  I was able to give both my sons deposits to get them started.  They both now own nice four bedroomed houses paying less on a mortgage than she does in rent. A scenario that's all too common for our young folk.  

Now I'm planning ahead to see what I can do for my grandsons, 4th generation.  At this stage I've no idea how much I can set aside for them but hopefully I can give them a bit of a leg up.  

Unless one has an extremely well paid job or has gained from inheritance then creating wealth takes time, often a lifetime. It takes some degree of sacrifice and forward planning.  

I am always reminded of the old adage......"Blessed are they who plant trees in whose shade they know they will never sit". Which of course isn't just about trees, it also applies to wealth creation and taking care of future generations.  I see it as good stewardship of resources.  

As an aside I always plant trees in every garden I create.  And every purchaser of the houses I've sold has been delighted.  

Rest period over, back to those wretched boxes.  Lol. 

helensbiggestfan

£1k interest on your stoozing is fantastic, especially as it's risk free. Just goes to show how using leverage can work.  

(Leverage using other peoples money, usually the banks,  to make money).  

Excellent work.