When someone under the age of 18 inherits property a “trust” is created by operation of law. A trust is a legal structure whereby people known as trustees to manage the money and assets inherited until the child turns 18 or perhaps 21 if a will imposes a higher age.
A will may make specific provision for the appointment of trustees who must take control of the child’s inheritance and this role will otherwise fall to the executors. If there is no will and the inheritance comes as a result of intestacy statutory trusts come into effect.
A trustee holds the money and assets comprising the inheritance and may use it for the benefit of the child. For example, income and capital may be used for the child’s schooling and other needs. The manner in which a trustee should manage the money and assets in his care may be stated in the will.
When the child turns 18 (or 21 or more if a different age is stated in the will) the trustee will transfer to the child the balance of the inheritance due. An executor is usually additionally appointed as a trustee by the will.