This is probably the most basic (and stupid) question on this whole board but i’m a beginner so I gotta ask these questions! I’m just wondering…..what is a trust?
Thanks in advance for whoever doesnt mind answering this
]You could writes books on this topic…Hey I think people already have.
But simply it is a separate entity that can own or trade on behalf of the beneficiaries, the income and capital then rests with the beneficiaries at the discrestion of the trust.
You can therefore move income from a potential highly taxed individual to someone who is not.
The trust is not a separate legal entity and that responsiblity is held by the trustee.
It is a tax and legal mine field, and even a lot of “expensive professionals …make some shocking mistakes…I would love a $1,000 for evry person I have seen who has bought a -prty in a trust.[]Hi HappyTrace,
By using a trust to own your assests, you:
[
] “Own nothing and control everything”[
] Protect your assets from possible attact under lawsuit[
] Pay less tax when the assets bring positive income or, when you sell for a capital gain.[
] Avoid the “rent reliance” complaint from the banks and thus retain your ability to continue investing.Tracy,
**PropertyGuRu** on here is an expert on trust, and is the person, i come to ask advice about Trust.
Also there are a few differnt tyes of Trust.
Family Descretionary Trust
Hybrid Trust
Unit TrustCheers
s.i.sSave on a regular basis
“People forget that by saving just $3 per day and investing it sensibly over a working life, you’ll end up with around $1 million.”
http://www.theenlightenedway.com/tools/mil_calc.shtmlHappytrace, for a plain english explanation of trusts and how best to use them, check out http://www.gatherumgoss.com and look at the ‘Trust Magic’ manual. It is excellent value.
Cheers
MelStill_In_School, can you explain how this avoids rent reliance? I thought rent reliance was when the bank will not lend you any more because all of your income is coming in from rent. Hence be considered too reliant on property market fluctuations.
Thanks
Mel, S.I.S and Gmh454 thanks for your help, now I read the forum topics about trusts and acutally understand!!
cheers
TraceVeryHappyTrace,
Everything about trust:
http://www.chrisbatten.com.au/
Kind regards
ChanDollars
[Keep going, you’re nearly reach the end of financial freedom]
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