PLEASE NOTE: This article was published on the date listed below and may now contain information that has since been updated or changed. We have retained this article as it may still contain helpful comments. However, we advise you to make an appointment to see us for the most up to date information on this topic.
If The Answer Is A Family Trust, Then What Is The Question?
Since the early 1990’s discretionary Family Trusts have been become a more viable alternative for protecting your assets and providing for your family (including yourself) in the future. A Family Trust is a separate legal entity but nevertheless under your control. It will have its own assets and income as well as its own IRD number. A properly created and administered Trust will ensure that the Trust’s assets and income are never mixed with your personal assets and income.
The Family Trust structure is not necessarily the ideal arrangement for everyone. If you are in business (either alone or with others), have concerns about potential beneficiaries of your estate, are in (or more specifically anticipate being in) a relationship or wish to divide your income producing assets from your passive assets (such as your home) then a Family Trust may be right for you.
We believe that careful consideration of your current circumstances and your future wishes is necessary to determine whether a Family Trust is the answer for you. To often people are encouraged to rush into forming a Family Trust without considering both the advantages and disadvantages. To assist you, in this consideration process, we are holding a series of free seminars to explain the process in identifying the issues you need to consider before creating your own Family Trust. Details of the seminars are included on page 4 of this Law Report. We encourage you to attend.
So the question is: "depending upon my circumstances and my future intentions, how do I best organise my financial affairs?" the answer may well be a discretionary Family Trust.