Trustee investment case study

How to fulfil your duties as a trustee

We developed an investment plan for a trust, which satisfied the trustees’ need to diversify assets and to look after the interests of the beneficiaries in a tax efficient manner.

“I value and trust the personal service delivered by Woodruff Financial Planning. They are on hand whenever I need them to discuss the best options for me. They manage my investment portfolio professionally and comprehensively, delivering regular updates and meetings to discuss investment strategy and progress. My investments have consistently risen in value registering an average increase of over 8% per year in the last 4 years despite the difficult trading conditions. I have no hesitation in recommending Woodruff Financial Planning to other would be clients.”

Jon Tayler – Investment Management client

Background

Duties of a trustee

The Trustee Act 2000 sets out a number of duties and responsibilities for trustees such as the duty to diversify assets, take professional advice and look after the interests of beneficiaries.

Balancing the needs of beneficiaries

Since the Trust had complex aims, the trustees needed advice on the most appropriate product and investment strategy for the trust money.
The trust needed to balance the need for income of some beneficiaries while securing the future capital for others.

Diversifying assets

They also needed to keep the trust money invested in a diversified way to generate the best long-term returns for the trust. Regular reviews were necessary to provide evidence that the trustees were performing their duties.

Our approach

We met with the trustees and the solicitor to establish the aims of the trust and the strategy for investment.

Investment portfolio

We established a risk profile for the Trust and built a portfolio of investments to aim to generate an acceptable level of income whilst growing the capital. As part of this we recommended an investment vehicle to deal with the tax position of the trust whilst giving maximum flexibility.

Outcomes and Impact

Consistent advice

By working with the solicitor we were able to create a unified approach so that advice was consistent on the legal and financial sides. We were also able to refer the trust to a local specialist accountant, who could advise them on their tax liabilities.

Trustees’ duties fulfilled

The trustees were able to satisfy their duties to look after the interests of the beneficiaries by taking specialist financial advice and diversifying the portfolio.

Regular reviews

Because we created regular reports for the trustees, they were able to demonstrate their compliance with their duties. This meant that they were less likely to come into conflict with the beneficiaries at a later date.