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...

702 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 702 community a safe and welcoming space for all.

702 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.

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

Read More
3 best shares to buy right now (by Falcon Crest Asset Managers)

3 best shares to buy right now (by Falcon Crest Asset Managers)

Looking for stock picks? Bruce Whitfield interviews Falcon Crest Asset Managers Chief Investment Officer Farai Mapfinya.

3 best shares to buy right now (according to Portfolio Manager Nesan Nair)

3 best shares to buy right now (according to Portfolio Manager Nesan Nair)

The Money Show’s Bruce Whitfield asks Sasfin Securities’ Nesan Nair what he thinks are the best companies to invest in right now.

How to make money by investing in classic cars

How to make money by investing in classic cars

Do classic cars make your heart beat faster? Here’ how they can make your wallet thicker…

Invest yourself rich! Buy Google shares! (FNB Securities)

Invest yourself rich! Buy Google shares! (FNB Securities)

Looking for a winner? Chantal Marx says you needn't look further than these two South African giants (and Google).

3 hottest JSE stock picks of the week (by Cannon Asset Managers)

3 hottest JSE stock picks of the week (by Cannon Asset Managers)

These three shares are the best investments on the JSE right now, says Cannon Asset Managers Portfolio Manager Samantha Steyn.

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
Roger Moore has died, age 89

Roger Moore has died, age 89

Listen to Roger Moore opening up to CapeTalk's Melanie Verwoerd about his life, acting and being James Bond.

Budget 2017: DA hoped for spending cuts, not tax increases

Budget 2017: DA hoped for spending cuts, not tax increases

The DA believes that raising taxes is not the answer to South Africa's economic woes and propose more cost-cutting for government.

Meet self-made millionaire (net worth – R400m!) property mogul Sisa Ngebulana

Meet self-made millionaire (net worth – R400m!) property mogul Sisa Ngebulana

How did Ngebulana build his empire? The Money Show’s Bruce Whitfield interviewed him for his weekly “ShapeShifter” feature.

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…

How Naspers paid peanuts for Tencent (China’s most valuable company)

How Naspers paid peanuts for Tencent (China’s most valuable company)

In 2001 Naspers invested $32 million in (then tiny) Tencent. Learn more about the wildly profitable Chinese behemoth...

Blesserfinder: Matching you with a sugar daddy near you

Blesserfinder: Matching you with a sugar daddy near you

Is social trend Blesserfinder, where girls are allegedly matching up with rich 'benefactors' in exchange for sex, a real thing?

5 reasons why the tourism industry is sceptical about the latest numbers

5 reasons why the tourism industry is sceptical about the latest numbers

The tourism industry is questioning the veracity of the surprisingly upbeat tourism figures and the timing of their release.