Complex Probate and Wills

Child Trust Funds

Parents and grandparents of children with disabilities should take steps to ensure that assets they want to leave to their disabled child do not deny them means-tested benefits when they become adults.

Simon Mee, a wills and estate planning specialist with law firm, Charles Lucas & Marshall says the simplest way of achieving this is by setting up a trust fund.

“This enables money or assets that parents, grandparents or other family members want to leave to the child to be ring-fenced,” he says. “The benefits and care structure they have set in place over many years will not then be jeopardised when the child becomes an adult.”

Sadly, many families discover too late that money or assets which have been set aside through a will to improve the welfare of a disabled family member can, in fact, create additional problems for that beneficiary. This may be because it affects the disabled person’s right to state support or the beneficiary may not be able to manage the money themselves.

“All benefits are mean tested with a sliding scale of entitlement,” says Simon Mee. “What is intended as a generous and responsible gesture can end up having a negative impact on the disabled person’s quality of living.

“These problems can be avoided by setting up a trust fund to manage the assets on behalf of the beneficiary. The Trust can appoint trustees to manage the fund and the person setting up the Trust can also write a letter of wishes, setting out their intentions and wishes as to how the trust fund should be managed.”

One mother who has set up a trust fund for her daughter is Elly Hase of Newbury. A mother of two, Elly’s oldest child, Ciara, six, was born with a rare chromosome disorder which means her levels of understanding are lower than other children her age. Doctors do not know how Ciara’s condition will progress.

“As I was getting divorced I thought it also seemed sensible to make a new will,” said Elly. “I wanted to make provision for my four year old son but also realised I needed to protect Ciara. The last thing I want is for the care structure we are developing for her to be taken away.

“It does mean, via my letter of wishes, I have leant heavily on my trustees to make decisions for Ciara. Equally though, my parents, who want to leave money for Ciara in their own wills, can now use the trust fund to do that and that gives them peace of mind .”

For further information please contact Simon Mee on 01635 521212 or simon.mee@clmlaw.co.uk