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Nearly half of parents concerned about how wealth would be distributed to their children if their spouse remarried

28/11/2018

The government, concerned about the outdated nature of trust taxation, has launched a wide-sweeping review aimed at ensuring trust taxation is simply, transparent and fair. 

However, research from Quilter highlights government should not throw the baby out with the bathwater as trusts offer far more than tax efficiency and are a good financial tool during an age of increasingly complex family arrangements.
 
The research* revealed 75% of parents want to control how wealth is passed down to their children. While the vast majority would trust their spouse to distribute the wealth, the challenge comes when there are divorces and remarriage – which are on the rise.
 
The remarriage rate for men is currently about 25 per 1,000 and for women 12 per 1,000 suggesting more men tend to re-marry compared with women, according to the ONS.
 
This is causing sleepless night for some parents as nearly half (48%) are concerned about how wealth would be distributed to their children if their spouse remarried.
 
Consider trust planning:
 
Trusts are a legal arrangement which ring fences money for future distribution to stated beneficiaries. If a surviving spouse remarries then a trust protects the wealth, ensuring it remains in place for the intended beneficiaries.
 
This can be particularly useful where children or grandchildren are still young, and the parent wants to protect wealth for their future, and have controls in place as to how and when the children/grandchildren can access the money.
36% of parents would consider trust planning to help ensure their wealth is protected for the benefit of their children, with a further 41% of parents saying they may be interested in trust planning.
 
Rachael Griffin, tax and financial planning expert at Quilter comments:

“Trusts date back centuries, which means at first glance some people may think they are legal structures which are now irrelevant for most people in modern-day society. However, this couldn’t be further from the truth. In fact trusts may be having a renaissance.
 
“Complex families are increasingly the norm and with that has come a rise in the number estate disputes ending up in court.  It’s vital the government consider how trust fit in modern day society and their consultation reflects their current usage.”
 
*Survey conducted by Toluna of 480 UK adults who are over 40 and married with children

 

For more information contact

Kathleen Gallagher023 8072 629307990 004932kathleen.gallagher@quilter.com

Notes to editors:

About Quilter plc:

Quilter plc is a leading wealth management business in the UK and internationally, helping to create prosperity for the generations of today and tomorrow.

Quilter plc oversees £118.1 billion in customer investments (as at 30 September 2018).

It has an adviser and customer offering spanning: financial advice; investment platforms; multi-asset investment solutions and discretionary fund management.

The business is comprised of two segments: Wealth Platforms and Advice and Wealth Management.

Wealth Platforms includes the Old Mutual Wealth UK Platform; Old Mutual International, including AAM Advisory in Singapore; and the Old Mutual Wealth Heritage life assurance business.

Advice and Wealth Management encompasses the financial planning network, Intrinsic; Quilter Private Client Advisers; discretionary fund management business, Quilter Cheviot; and Quilter Investors, the Multi-asset investment solutions business.

The Quilter plc businesses are being re-branded to Quilter over a period of approximately two years:

• The Multi-asset business is now Quilter Investors

• Intrinsic to Quilter Financial Planning

• The private client advisers business is now Quilter Private Client Advisers

• The UK Platform to Quilter Wealth Solutions

• The International business to Quilter International

• The Heritage life assurance business to Quilter Life Assurance

• Quilter Cheviot will retain its name

This press release is for journalists only and should not be relied upon by financial advisers or customers.

Please remember that past performance is not a guide to future performance. The value of investments and the income from them can go down as well as up and investors may not get back any of the amount originally invested. Exchange rate changes may cause the value of overseas investments to rise or fall.

This communication is issued by Quilter plc.  Registered office: Millennium Bridge House, 2 Lambeth Hill, London EC4V 4AJ, United Kingdom. Registered number: 6404270.  Registered in England.