Building wealth with trusts

GENERATIONAL: A POWERFUL VEHICLE THAT KEEPS FAMILY ASSETS INTACT FOR DECADES

- Devon Card

PRESERVATION. Trusts demand careful management and professional guidance, but for families focused on lasting wealth, they remain one of the most powerful estate planning tools. Picture: AdobeStock

(AdobeStock)

For many South African families, the question of how best to preserve and transfer wealth from one generation to the next has become increasingly important. Rising life expectancy, complex family structures, and shifting tax legislation mean that estate planning must extend well beyond a simple will.

One of the most powerful vehicles available to achieve this is the living trust a flexible structure that not only protects assets but also ensures they are managed with care and intention long after the trust founder has passed away.

A living trust (inter vivos trust) is established by a founder during their lifetime through the drafting of a trust deed which sets out the terms, powers, and objectives of the trust.

The founder transfers assets into the trust, which are then legally owned by the trust itself and managed by trustees for the benefit of its beneficiaries. While the founder no longer owns the assets personally, they retain influence through careful drafting of the trust deed and by appointing trustees who will carry out their wishes.