Best way to leave money for guardians to rear my kids?

[hullabaloo]

Hi,

My spouse and I plan to get our wills done now that we have young kids.

In the unlikely event that my husband and I both die together before our two kids reach 21, we would like to ensure that whichever family member takes on their guardianship has plenty of money to look after them. We have our live's insured for about 1.2 million (our thinking is that's the equivalent of a 60K salary over 20 years).

So my question is how does this normally work? Is it left up to the executor to setup a trust fund or do we do that now? Is a trust fund even necessary?

Thanks in advance.

 

[Vanilla]

The usual thing is that your wills would nominate guardians and trustees. In the event of both of your deaths, your assets would go into a trust to be held by the trustees and applied for the benefit of your children until they reach the age of 18. While you can stipulate 21 as the age, trusts can ultimately be broken once your youngest reaches 18. Usually the trust is a discretionary one, which allows the trustees broad powers on how to invest/ apply the funds for the benefit of the children. However you could have a fixed trust. There are tax implications, which your solicitor will advise you in relation to. Once the children are 18 the remaining property is usually divided equally between them. This is a very simple and general overview, and when you make your appointment with your solicitor you can discuss it in depth.