Discretionary trusts
If you have a child with muscle disease, you will want to ensure that they are provided for in your Will. However if, your child inherits a lump sum of money and/or your house, it may result in their loss of means-tested benefits.
In cases like this, you may wish to consider setting up a discretionary trust for them in your Will, where you would leave your child's inheritance to "trustees" to look after it and apply it for the benefit of your child. This can allow your child to benefit from your estate, but since they do not inherit the funds outright, it means that they can continue to receive any means-tested state benefits. The money that they may potentially receive from the trust fund may not be included as "relevant capital" when being assessed for state funding - only if the trustees actually pay your child any money will they be assessed. If the trustees spend money from the trust on your child (such as paying for holidays, clothes etc), this will not be assessed.
To set up a discretionary trust, consult a wills and trusts solicitor who has expertise in this area. Make sure that you discuss with them the type of trust you need, in order to protect your child's financial future. You will need to think carefully about who to appoint as trustees, as they will have a lot of control.
Making a Will and setting up a trust in your will to protect your child's inheritance is the only way to safeguard your family's future.
The Law Society can help you find a solicitor in your area by calling 020 7242 1222 or by visiting Solicitors online
