Why do people set up trust ?

The reasons are :
(1)Assets held under Trust are not frozen upon demise.
(2)For the distribution of wealth, including periodical payment.
(3)To ensures the wealth is protected against lawsuits as well as creditors.
(4)The preservation of wealth.
(5)Fulfilling various personal objectives, including such as maintenance of dependents and education funds.

Examples of common usage of trust :

1) Distributing Wealth to Avoid Probate

Trust of this nature is useful when you have:

1. Minor children and spouse who is a homemaker or earning not as much as you
2. Special children requiring funds for medical, education and living expenses
3. Have a 2nd Family to provide for
4. Financing children’s tertiary education.

2) Protecting Wealth

Protecting Against Wasteful Beneficiaries

The Protector appointed will ensure there is no wastage of moneys receive under the Trust. Protector can stop disbursement of fund to undeserved beneficiaries.

Against Creditors of Settlor and Beneficiaries
Protector will instructs Trustee to stop the disbursement of fund whenany beneficiary has become a bankrupt.

Protecting Wealth Against the Settlor's Creditors
When a person becomes a bankrupt, usually an investigation by the authorities is done to recover assets transferred up to 5 years prior to bankruptcy. The suspicious transfers will be nullified to recover the assets to pay the creditors.


3) Protecting Wealth Against the Beneficiaries’ Creditors!

This is achieved by creating a Discretionary Trust when any of the beneficiary becomes bankrupt, he will no longer be entitled to the benefit under the Trust.

4) Preserving Wealth for Your Great Grandchildren
Preserving assets for your great grandchildren.

5) To cater funds for various family situations
For example, education and Maintenance fund for grandchildren, nephews etc