MyMoney Online

Three reasons why you should have a trust

A trust is a useful entity in some circumstances as the assets it owns do not belong to you and are managed for the benefit of its beneficiaries.

Here are 3 reasons why you should have one:

Long term planning for your family

If you want your assets to provide for the long term for you, your children and grandchildren then a trust may be an appropriate vehicle. In the event of your death the assets in the trust will not trigger capital gains tax as they will not have to be sold or transferred which is the case in your personal estate. Estate duty is also avoided as the assets are owned by a trust which has perpetuity as it continues after your death. A trust never dies.

Minor children

If parents die leaving behind minor children this causes huge complications for their financial future. If there is no will the assets will be cashed in and the proceeds invested in the Guardian Fund administered by the Master of the Supreme Court.

A testamentary trust which is set up in terms of your will is ideal in these circumstances as it creates a structured entity which provides for the financial well being of your children up to an age where they can take over control of the assets for themselves.

Asset protection

When you set up an irrevocable trust you relinquish control and ownership of your assets in the trust. If you fall into a legal problem leading to a claimants forcing you to to liquidate, your assets in the trust cannot be included as they are not owned by you. This form of asset protection should be considered carefully with expert advice.

A large estate attracts tax and estate duty. A trust can avoid these costs in a very legitimate way. It boils down to costs verses benefits at the end of the day.

Listen to the conversation below...

CapeTalk welcomes all comments that are constructive, contribute to discussions in a meaningful manner and take stories forward.

However, we will NOT condone the following:

  • Racism (including offensive comments based on ethnicity and nationality)
  • Sexism
  • Homophobia
  • Religious intolerance
  • Cyber bullying
  • Hate speech
  • Derogatory language
  • Comments inciting violence.

We ask that your comments remain relevant to the articles they appear on and do not include general banter or conversation as this dilutes the effectiveness of the comments section.

We strive to make the CapeTalk community a safe and welcoming space for all.

CapeTalk reserves the right to: 1) remove any comments that do not follow the above guidelines; and, 2) ban users who repeatedly infringe the rules.

Should you find any comments upsetting or offensive you can also flag them and we will assess it against our guidelines.

CapeTalk is constantly reviewing its comments policy in order to create an environment conducive to constructive conversations.

Read More
2 best investments on the JSE right now (and one from the USA)

2 best investments on the JSE right now (and one from the USA)

It’s Stock Pick Monday on Bruce Whitfield’s The Money Show. He interviews I-Capital Managing Director Lance Williams.

Women are better investors than men

Women are better investors than men

Warren Ingram explains why it is that women clearly outperform men.

Hottest shares you can buy right now (by Fairtree Capital)

Hottest shares you can buy right now (by Fairtree Capital)

The Money Show’s Bruce Whitfield interviews Portfolio Manager Jean-Pierre Verster.

Unsure where to invest? These are the best shares right now (by Anchor Capital)

Unsure where to invest? These are the best shares right now (by Anchor Capital)

Sumitra Nydoo (on The Money Show) interviews Anchor Capital Analyst Henry Biddlecombe.

How accurate (or off the mark) stock pickers on The Money Show have been in 2017

How accurate (or off the mark) stock pickers on The Money Show have been in 2017

Bruce Whitfield grills three stock pickers he interviewed in January on the performance of their picks for 2017.

Three reasons why you shouldn’t have a trust

Three reasons why you shouldn’t have a trust

Having a trust seems like the right thing to do but financial planner, Paul Roelofse says it's not that beneficial for you.

Popular articles
Discovery CEO (and founder) Adrian Gore bares his soul about money

Discovery CEO (and founder) Adrian Gore bares his soul about money

The Money Show’s Bruce Whitfield interviews Gore about his attitude to money (hopes and fears, successes and failures, etc.).

Ocean Basket gives franchise owner the chop after assault video

Ocean Basket gives franchise owner the chop after assault video

The man was immediately divested of his shares and is no longer part of the group, explains Ocean Basket CEO Grace Harding.

LISTEN: A 'smaller nyana' mash-up of Bathabile Dlamini's most outrageous quotes

LISTEN: A 'smaller nyana' mash-up of Bathabile Dlamini's most outrageous quotes

ANC Women's League president Bathabile Dlamini is no stranger to controversy and has made many head-scratching comments before.

WATCH: Cape schoolkids 'starstruck' after Trevor Noah,  Charlize Theron drop by

WATCH: Cape schoolkids 'starstruck' after Trevor Noah, Charlize Theron drop by

Oaklands High principal Reza Patel says it was an extremely exciting experience for both the learners and staff. We can imagine!

CoCT explains new electricity tariffs

CoCT explains new electricity tariffs

Following residents concerns over new electricity tariffs and properties being re-evaluated, Johan van der Merwe provides clarity.