If you have a disabled or vulnerable member of your family, it is not necessarily a good idea to leave an inheritance to them in your Will.
There are several reasons why not:
- - Disabled people usually qualify for benefits to support their lives financially. These are often means tested. However, if they own above certain thresholds then they don’t qualify.
So, giving a substantial part of your estate to them will inevitably result in them losing their benefits. They will then have to pay for themselves from the inheritance left to them.
- - If they suffer from mental health challenges, then they may not be able to manage their inheritance responsibly. If this was the case, then if a loved one doesn’t already have legal authority to manage the financial affairs, there may be a need to obtain Court permission to do so. This is called a Deputyship application.
- - Where beneficiaries are vulnerable or disabled and receive a substantial inheritance, they can sometimes attract individuals around them who will be only too happy to help them spend their inheritance….usually not for the benefit of your loved one.
We can discuss with you options to protect the interests of such beneficiaries. For example, rather than leaving part of your estate directly to them, you could choose to leave their inheritance into a trust.
Although, there are several different types of trusts, typically their inheritance passes not directly to them, but to members of your family or friends you trust, not surprisingly called trustees.
They then have certain powers as to how they use the trust fund for the benefit of your loved ones, so their inheritance is taken care of, without affecting any means tested benefits they may be receiving. They can get on living their lives knowing that their inheritance is being managed for them, and can be used to take care of any of their needs in the future.
Please contact us for more details on how the use of trusts can protect the interests of vulnerable or disabled beneficiaries.