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OUR INSIGHTS

  • Jeremy Callander

Triaging your affairs

Jack and Jill are married with children from Jill’s previous marriage. Jack and Jill have set up a trust and transferred the family home to the trust.

Jack and Jill are concerned that if Jill dies first:

  1. Jack should be able to carry on living in the family home and downsize if he wants or needs to do so. However, …

  2. Jack may also wish to enter into a new long-term relationship, and …

  3. If Jack and his new partner commence such a relationship, the family home may become intermingled with the assets of Jack’s new partner, and …

  4. If the new relationship subsequently breaks down, Jill’s children’s inheritance may end up being a lot smaller than Jack and Jill initially planned. and to mix things up a little more...

  5. Jack and Jill’s trust can facilitate multigenerational ownership of the family home, and it might help Jack and/or Jill to qualify for a Residential Care Subsidy.

  6. On the other hand, the trust will not really protect the family’s assets from the breakdown of a new relationship. And if the children go and live overseas, any distributions from the trust will likely incur some pretty hefty tax liabilities.

  7. Of course, Jack and Jill could wind up the trust. But then they would lose the benefits which the trust currently/potentially provides.

It is often at about this point, that people like Jack and Jill decide to put all of these questions in the “Too Hard” basket……because it seems like it is all just a bit too much.

At Lucas and Lucas we can help you to identify, separate and weigh the different issues that confront you, along with the difference options that may be available to you.


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