A Life Interest Will is a specialised type of Will which allows you to pass on assets (such as a house) to your children whilst your surviving spouse still has the benefit of those assets whilst they are alive.
Life Interest are becoming increasingly popular as more people remarry after a divorce or a bereavement, who have children from a previous marriage. They make it possible to ensure the financial security of your current spouse while also protecting your children’s inheritance.
A common example of this is when someone wants to ensure that their current spouse is financially secure should they die first, but they also feel it is only right that their children from their previous marriage should inherit their assets. This is often the case when the main asset is the family home which was substantially paid for during the previous marriage.
As an example, with a standard Will, when assets are left to the new spouse, those assets become theirs and would then become part of their estate when they pass. This could mean that those assets never make their way to your children.
It is possible to avoid this situation with a Life Interest Will. Using the family home as an example, you may wish to leave the property to your children eventually, but still enable your current spouse to live in it after you have died.
You can give your spouse a Life Interest in the property, meaning that they can continue to live in the property until they die or remarry, after which it passes on to your children or other chosen beneficiaries.
Assets are held in a Life Interest Trust and those assets can be either property or cash assets.
Control the ultimate destination of your assets.
Your partner can retain the benefit of the assets which are held in trust. This could be income from funds or the ability to continue living in a property.
Mitigate against nursing or care home fees
Once again, assets held in Life Interest Trust are ring fenced and cannot be taken in the event of your spouse’s bankruptcy.
For more information please contact us.