Clearing the decks

When my wife died her share of our property went to our children. I am now considering giving them the other half in order to simplify things. Is this a good idea? I am also thinking of putting my finances into trust for them.

Am I right in thinking that once this is done I will not be able to touch the money? Of course I have made a will leaving everything to them anyway. AG

You should really discuss your finances in detail with a solicitor. What you’re suggesting in respect of your house will not help to avoid inheritance tax because if you give away an asset and carry on enjoying it, the asset given away will still be taxed on your death as if you owned it at the date of your death.

The proposed gift won’t necessarily save on care home fees either, if that’s worrying you. Generally speaking it’s not a good idea to give others, even your children, outright control of your money and property. If they were to die or get divorced you could lose both.

Setting up a trust could well deny you access to your capital, depending on the wording of the trust document, and could add complication rather than simplification!

For richer, for poorer

I’m quite heavily in debt, but I’ve come to an arrangement with my creditors over repayments. However, I’m getting married in six months’ time, and wondered if my future husband will become liable for my debts in any way? LB

Husbands and wives are not usually responsible for each others’ individual debts.

However, if you open a joint bank account for example, or buy a house in joint names, your creditors could try to get their money from these.

So you’ll have to be a bit careful about linking your finances while you still have debts outstanding.