Families come to us for our respectful, understanding approach to delicate situations.
If you are thinking about the long-term security of your loved ones, you may have come across the term Life Interest Trust. But what exactly is a Life Interest Trust, and why is it becoming such an important part of estate planning for families today?
At Will 4 Less, we understand that planning your estate isn’t just about distributing assets; it’s about ensuring the right people benefit at the right time, while protecting your family home and providing peace of mind.
Understanding What is Life Interest Trusts? -The Basics
A Life Interest Trust (sometimes called an Interest in Possession Trust) allows you to leave your assets in a way that protects them for future generations, while still providing financial security for your chosen beneficiary during their lifetime.
For example, many people set up a Life Interest Trust so their spouse can live in their shared home for the rest of their life, while ensuring that the house eventually passes to their children.
This is one of the main reasons people search for information about Interest in Possession Trust – they want to balance security for their partner with inheritance protection for their children.
Many of our clients express common concerns:
A Life Interest Trust addresses these natural worries by:
A Life Interest Trust can offer many advantages, especially if you’re trying to protect both current and future generations.
1. Security for your partner
Your partner won’t be forced out of their home after you’re gone. They have a legal right to live there for life (or until they choose to move out).
2. Guarantee for your children
Your children or named beneficiaries are legally protected to inherit once your partner passes away. It removes uncertainty and safeguards their future.
3. Potential care home fee protection
If your partner later needs residential care, the property (or share of it) held in the trust might not be counted as part of their estate-helping preserve family wealth.
4. Protection from remarriage risks
Without a Life/Possession Interest Trust, your surviving partner could remarry and potentially rewrite their will, leaving your children with nothing. This trust prevents that scenario.
People who most often choose a Life Interest Trust include:
What’s the Difference Between a Life Interest Trust and a Flexible Life Interest Trust Fleet?
When planning your Will and thinking about how to protect your loved ones, you might come across two similar-sounding terms: Life/Possession Interest Trust and Flexible Life Interest Trust. While they may appear the same at first glance, they serve different purposes and offer different levels of flexibility for your family’s future.
1. Life Interest Trust – The Basics
A Life/Possession Interest Trust is quite straightforward. It gives someone (often your spouse or partner) the right to benefit from an asset (usually your share of the family home or your investments) for the rest of their life.
For example:
Key Point: Offers protection for your children’s inheritance while looking after your spouse during their lifetime.
2. Flexible Life Interest Trust – A More Adaptable Option
A Flexible Life Interest Trust starts in the same way as a standard Life/Possession Interest Trust. Your chosen person still receives income or use of the asset for life. However, it’s called “flexible” because the trustees have additional powers to adjust who benefits from the trust and when.
For example:
Key Point: Provides greater adaptability to meet changing family needs, tax considerations, or unexpected circumstances after your death.
Deciding whether a Life/Possession Interest Trust is right for you depends on your family structure, financial goals, and emotional priorities. Many people want to balance care for their partner with securing their children’s future.
A Life Interest Trust provides peace of mind that your wishes will be carried out exactly as you intend.
At Will 4 Less, we specialise in guiding families through this important decision with compassion, clarity, and expertise. If you’re thinking about adding a Life/Possession Interest Trust to your Will, or simply want to understand your options better.
Contact us today we will ensure you feel informed, confident, and at ease with your choices for the people who matter most in your life.
