Discretionary Trusts Explained: Flexibility for Your Family’s Future

When it comes to estate planning, life rarely fits into neat boxes. Families grow, needs change, and circumstances shift. That’s where Discretionary Trusts shine — offering flexibility, protection, and control over how your assets are passed on.
This blog focuses on Discretionary Trusts created in your Will. These Trusts only come into effect after your death, giving your Trustees the power to distribute your estate according to your wishes and your beneficiaries changing circumstances.

What is a Discretionary Trust?

A Will-based Discretionary Trust allows you to name a group of potential beneficiaries (such as your children, grandchildren, or other loved ones), but the Trustees — the people you choose to manage the Trust — have full discretion over: 

Who receives funds;

When distributions are made;

How much is given;

No one beneficiary has an automatic right to the assets. This gives your Trustees valuable flexibility to support your family in the most appropriate way, especially when future needs are unknown.

Real-World Examples

1. Supporting Different Needs at Different Times

Tanya has three adult children: one is financially secure, another is starting a family, and the third has struggled with debt. Rather than divide her estate equally, she sets up a Discretionary Trust in her Will. After her death, the Trustees can provide help where it’s most needed — like a house deposit or childcare support — without compromising the Trust’s long-term goals.

2. Planning for Future Grandchildren

Amir and Priya don’t yet have grandchildren but expect their family to grow. In their Wills, they name “all current and future grandchildren” as potential beneficiaries. The Trustees can decide how and when to provide support — such as funding education or helping with a first home — even for grandchildren born after their passing.

3. Protecting Against Risk

Tyrone wants to leave money for his daughter Simone but worries her partner is financially irresponsible. A Discretionary Trust in his Will allows Simone to benefit when needed, but the funds aren’t legally hers — helping to protect the inheritance from divorce settlements or creditors.

Why Choose a Discretionary Trust in Your Will?

Key Benefits:

• Adaptability: Adjust support based on real-life needs after your death
• Control: Trustees manage assets in line with your guidance
• Protection: Helps safeguard inheritance from divorce, debt, or misuse
• Tax Planning: May reduce Inheritance Tax in some cases

Final Thoughts

A Discretionary Trust in your Will offers the flexibility to respond to life’s changes, while still protecting your estate and loved ones. It’s a valuable tool for those who want thoughtful control without locking in rigid rules.

If you're considering this type of planning, now is the time to explore your options with expert guidance. Call today.