Forum Archive Index - November 2001

["Investor 99" <investor99@email.com>]

Regarding your comments about Family Trusts Hugh:

"Oh, I don't know re the Family Trust stuff - its all become very trendy
but in fact I've found having my own company is far cheaper, easier
administratively, more flexible and there aren't any silly time limits in the
event of death etc."

Having your own company AND a Family Trust is even better because the Family Trust can hold a majority shareholding in the company, which allows you to do income splitting via discretionary distributions to various beneficiaries.

What's more, if you have the Trust Deed set up correctly, you can resettle the assets of an existing trust into a new trust without any major hassles.  As with many things in life, the devil is in the detail so you need to get it set up properly from day one, then everything you want to do later can be accommodated.

"Still, Martin Hawes managed to make a good living out of it while the fad
lasted......"

Family Trusts are not a fad, they have been used widely for the last 100 years or more.

"Some people believe anything they're told by "experts" instead of investigating for themselves."

Yes, and some other people go and talk to several "experts" then do their own research and pick the most suitable option.  Having a Family Trust allows me to pay for my children's education out of money which has been taxed only at their marginal rate of tax (19.5% instead of 39%).  And it allows my wife and I to split our income as $60k each, then deduct $30k odd distributed to the children before we start paying 39% tax.  Even then, there are ways to avoid the 39% tax rate completely by distributing tax-paid income out of the trust as a capital distribution.

There you have it Hugh.  If you still say in light of the above points that Family Trusts are a valueless fad, well you are entitled to keep your opinion.  Go on paying 39% tax on some of your income.  Meanwhile, I'm happy to keep saving $000's per year by using a Family Trust.

--

_______________________________________________
1 cent a minute calls anywhere in the U.S.!

http://www.getpennytalk.com/cgi-bin/adforward.cgi?p_key=RG9853KJ&url=http://www.getpennytalk.com

----------------------------------------------------------------------------
To remove yourself from this list, please use the form at
http://www.sharechat.co.nz/chat/forum/