Ask Shade About Trusts: Does My Husband Have to Know?

Ask Shade About Trusts: Does My Husband Have to Know?

Hi Shade,
My name is Gloria, I got married 5 years ago at 35. Before the wedding, I already built a house at Mowe, a block of 6 flats, and I have other undeveloped property that I didn’t tell my husband about (so as not to intimidate or repel him). My plan is to gift the property to my children as a start-up fund the moment they are done with university. Do I have to declare these assets to my husband? If anything happens to me along the way, how can I ensure my children get these assets? The properties were bought in my name.
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Hi Gloria,
It is quite commendable that you were resourceful enough to invest in assets as a young woman; even more commendable that you are planning towards a secure future for your children.

One of the best ways to secure your property is to set up a Trust, naming your children as beneficiaries. A Trust is a legal relationship amongst 3 parties – the Settlor, the Trustee and the Beneficiaries. The Settlor being the original creator of the Trust, the Trustee the ‘holder’ of the assets transferred to the Trust and the Beneficiary or Beneficiaries the party or parties for whose benefit the Trust has been established. Trusts are very confidential in nature and as such make it possible for you to achieve your objectives privately.

You can set up a Trust and transfer these assets to the Trust. The assets will be held in the name of your Trust/Trustee and in due course, income generated from these assets can be given to your children to start up their own businesses. Alternatively, at a designated time, your Trust may sell such real estate asset and give proceeds to your children as seed investment for their businesses. You can guide your Trustees, even in absentia through a Letter of Wishes. Putting the assets in a trust today offers the protection you require for the assets because such assets will be legally independent of you.

As you are still young and active, I would recommend that you set up a Trust that still leaves the role of management of your assets and investment decisions to you.

To “protect” your marriage, you may choose to set up a joint Trust with your husband or name his as a beneficiary under the Trust with instructions on what exactly you wish to give to him and when. It is not necessary for beneficiaries to know about the Trust.

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Ask Shade About Trusts: My Mum Just Found Love Again! But How Do I Protect My Future?

Ask Shade About Trusts: My Mum Just Found Love Again! But How Do I Protect My Future?

By setting up a trust, your mother can ensure that the fashion line is passed on to you at her death, even though she retains full control while she is alive. She can name beneficiaries of the trust and include her new spouse so as to achieve some balance.

 

Hello Shade,

For five years since I returned from the UK after my Masters program, I’ve worked side by side with my mum to run her highly lucrative fashion line. As a single mum, my mother single-handedly worked hard to build her fashion empire, and with my additional effort, it is currently worth millions of naira. I share in her passion and have shown it through dedication and hard work, but now I’m worried. Mum recently found love again and wants to get married to a widower who has two sons. My mum is wealthier than this man, and the man’s sons are still totally dependent on him.

How do I ensure that this marriage won’t cost me the fashion empire, which by right should remain in my family as an inheritance?
– Jessica, Lagos

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Dear Jessica,
I totally understand your apprehension regarding your mother’s fashion empire. Indeed, your concerns are genuine, as it could be very disappointing to lose out completely in a business you have contributed so much to. The reality is that most people fail to take the necessary steps that would ensure that their assets are protected and preserved for the benefit of their loved ones when there is a major change in their circumstances, i.e. marriage, divorce, separation, death or permanent disability.

In the case of your mother, it would be most constructive if she considers setting up a trust to manage the affairs of her business and ensure continuity of her fashion empire, for the benefit of her beneficiaries even after her demise. A trust is an arrangement that affords the settlor (the person who sets it up) to transfer its/his/her assets to a third party (the trustee) to hold for the benefit of a named person or group of persons called the beneficiary(ies).

By setting up a trust, your mother can ensure that the fashion line is passed on to you at her death, even though she retains full control while she is alive. She can name beneficiaries of the trust and include her new spouse so as to achieve some balance.

I would advise that you find a convenient time to have a conversation with your mother to confirm how she intends to sustain the business continually. This trust structure should gain her interest and allay any form of misconception about your intentions, since the discussion would be centered more about protecting her legacy than one of you trying to oust your soon to be step-father and step brothers from your mother’s estate if she predeceases them.

I wish you and your mum the best.

Cheers,
Shade

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