Project Description

The problem

Our clients wanted to support their son’s financial future in their wills. However, their son had a learning disability which made him reliant on existing state benefits and associated care arrangements. If he were to inherit a lump sum, it could put these arrangements at risk.

The Process

We advised our clients to write a discretionary trust into their wills with their son as one of the potential beneficiaries.

The Result

The money in the discretionary trust would not be assessed for any means-tested benefits, which meant their son’s existing care arrangements would not be affected. However, the trust would be there as a safety net should it be required.

How this helped

Our clients’ son had a significant learning disability. He still lived in the family home as his disability meant he would be unable to manage living alone. Naturally, our clients were concerned about how their son would be cared for in the event of their deaths.

The wills our clients had previously written split their estate equally between their children. However, they’d realised that in practice a large inheritance was likely to disadvantage their son. Not only would it take away his means-tested benefits, it would also put the support associated with these benefits at risk.

Our clients were also concerned that inheriting a lump sum would affect how their son was assessed for a supported accommodation placement, which he’d need if he was no longer able to live with them.

We worked with our clients to draft new wills that didn’t leave an outright inheritance to their son. Instead, they nominated a sum of money to be put into a discretionary trust for him and their other children.

As no one beneficiary of a discretionary trust is entitled to any set amount, the money in the fund would not be included in any assessment relating to their son’s benefits or eligibility for supported accommodation.

The trust allowed for money to be paid to our clients’ son as and when he needed it. It also made it possible for money to be paid directly to organisations such as landlords and care facilities. This was important as his learning disability meant he wasn’t very good at managing money without support and our clients didn’t want him to be put under any undue pressure.

Our clients were pleased with the discretionary trust as a solution. It meant they didn’t need to worry about a direct inheritance putting their son’s benefits or care arrangements at risk, but could still rest assured they were leaving him a robust financial safety net should he require it.

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