Letters of wishes
6 September 2018
If you have incorporated a trust into your will, or have created a lifetime trust, then it is important to let your trustees know what your wishes are with regards to how you would like the assets of your trust to be managed and distributed.
The best way to do this is to set out your wishes in writing or, more specifically, in a letter of wishes to your trustees.
Letters of wishes are not legally binding but they do hold strong moral weight and your trustees should have good reason to depart from their guidance.
You can include guidance such as ages at which you envisage your beneficiaries receiving capital from the trust fund, what you envisage the trust fund being used for – i.e to fund educational costs or to help with the purchase of a property etc.
A great benefit of letters of wishes is that they can be updated as often as you like – if your circumstances change or you simply change your mind – without the need to update your will itself.
Letters of wishes should be signed and dated by you and then stored with your will or trust document.
Letters of wishes can also be useful in other circumstances, for example to provide guidance to any guardians you may have appointed for your infant children, in the event that you were to die whilst they were still minors, and to provide guidance to any attorneys you may have appointed under lasting powers of attorney. As above, these letters will not be legally binding but will provide helpful guidance.
There are certain factors to consider when preparing or updating a letter of wishes such as whether the letter should be confidential to your trustees or whether you are happy for your beneficiaries to be able to see it too, and whether what you would like to say in the letter is within the scope of what the will, trust, LPA or law allows. In some cases, it may be necessary to amend or put in place new documents if a letter of wishes is not suitable.
If you have a will which includes a trust, LPAs or have appointed guardians for your infant children and would like to put in place or review your letters of wishes, please do not hesitate to contact Birketts Private Client Team who will be able to assist you with this. Law covered as at September 2018.
The content of this article is for general information only. It is not, and should not be taken as, legal advice. If you require any further information in relation to this article please contact the author in the first instance. Law covered as at September 2018.