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...

Read More
Earn peanuts? How to best invest very small amounts...

Earn peanuts? How to best invest very small amounts...

Got a spare R200 or R300 a month? Here’s how to make that money work hard and grow…

3 stocks that’ll boost your wealth this January (by Herenya Capital Advisors)

3 stocks that’ll boost your wealth this January (by Herenya Capital Advisors)

Looking for great investments? Herenya Capital Advisors’ Petri Redelinghuys says you need not look further than these three…

Financial advisor answers listeners' money questions

Financial advisor answers listeners' money questions

The Money Show’s Bruce Whitfield interviewed Galileo Capital Personal Financial Advisor Warren Ingram.

How I’m investing for my child’s education - share trader Garth McKenzie

How I’m investing for my child’s education - share trader Garth McKenzie

Share trader Garth McKenzie started a portfolio of 10 stocks when his son was born. It’s going quite well for him…

Invest yourself rich in 2017! 4 experts share some hot stock picks for the year

Invest yourself rich in 2017! 4 experts share some hot stock picks for the year

The Money Show’s Bruce Whitfield asks four portfolio managers for hot tips on where to put your money to work this year…

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
Brother of man who died in Kuga opens up on air, discusses lawsuit against Ford

Brother of man who died in Kuga opens up on air, discusses lawsuit against Ford

John Maytham interviews Kaveen Jimmy; who says he has damning evidence against Ford.

'My daughter bought Spur shares when she was 10 years old' - Dr Adrian Saville

'My daughter bought Spur shares when she was 10 years old' - Dr Adrian Saville

What does Citadel’s famed disciple of contrarian, deep-value investing Dr Adrian Saville hope for (and fear) about money?

‘3 richest South Africans have wealth equal to the poorest 28 million’ – Oxfam

‘3 richest South Africans have wealth equal to the poorest 28 million’ – Oxfam

The Free Market Foundation's Leon Louw, however, calls Oxfam "OxScam" and says the organisation does not care about poor people.

It's not the end of the road... Top tips to improve your matric

It's not the end of the road... Top tips to improve your matric

"Recognise that it’s not the end, it’s the beginning." Expert advise for school-leavers who want to improve their results.

NSFAS to reopen 2017 applications

NSFAS to reopen 2017 applications

National Student Financial Aid Scheme says it will reopen 2017 loan applications after receiving requests for deadline extension.

Right now, these are the best shares to buy on the JSE (according to Adviceworx)

Right now, these are the best shares to buy on the JSE (according to Adviceworx)

Bruce Whitfield interviews a Portfolio Manager about what she believes are the hottest stocks right now.

They couldn’t fix his iPod, so he did it himself (thereby creating iFix)

They couldn’t fix his iPod, so he did it himself (thereby creating iFix)

Alex Fourie created iFix in 2006 from his dorm room at university. Today it repairs about 10 000 devices a month.

5 ways the NSFAS funding model will change in 2017

5 ways the NSFAS funding model will change in 2017

The National Student Financial Aid Scheme (NSFAS) will pilot a new funding model in 2017. NSFAS chairperson Sizwe Nxasana explains.