Financially speaking, a Trust is a ring-fenced set of assets managed by one person (the Trustee) on behalf of another person (the Beneficiary). These financial entities can be set up (by a Settlor) for a number of reasons, such as the management of someone’s estate after they’ve passed away, or the provision of a managed wealth portfolio for a child who is not yet old enough to access the funds that belong to them.

  • Legally speaking, a Trust is just a binding agreement between the three people defined above (Trustee, Settlor, and Beneficiary).

    Once you understand these facts, and assuming that you know what a bank account is, understanding what Trustee Bank Accounts are becomes very simple: they are just tools by which the Trustee manages the beneficiary’s funds.

  • If you are being appointed as Trustee of a new Trust, then you will most likely have to set up a Trustee Bank Account in order to perform your duties. If you are already a Trustee of an existing Trust, you will already have a bank account – but how competitive are the account charges and interest rates compared to other products on the market now? In either case, we can help.

Trustee Investment Accounts

As a Trustee you should be aware of the financial requirements of the beneficiaries. You may, for example, be appointed to a Trust where the beneficiary is a charity, and the requirements include capital growth. You should also be aware of any life tenants (beneficiaries in a Life Interest Trust) and take their needs into account: income? Capital growth? Both? 

  • Whatever your specific responsibilities, you will need to be aware of the scope and style of investments that you can make. This scope is detailed in the Trust Deed and will give very restrictive investment choices, such as bank and building society deposit accounts only. However, it might give far wider powers to include Unit Trusts, Shares, Life Assurance Investment Bonds and property.
  • You should also be mindful of the tax position of the Trust and the beneficiaries, as this will affect which types of Trustee Investments are suitable and which types of investments are less favourable. Trustee Investments do not include the same security of capital which is afforded with a trustee deposit account. You may get back less than the amount invested.

Fulfilling your role as Trustee

The Trustee is usually considered the most important person in the Trust, and has ultimate responsibility for it. But exactly what that responsibility consists of varies from Trust to Trust. In some instances, it may require daily financial management or the use of a Trustee Investment Account. In others, it will function basically as a savings account, with very little active management required.

  • It is by no means unusual for a Trustee to seek help when it comes to the management of their responsibilities, and Simpson Financial Services has a long history of providing impartial, expert, advice.

    Whether you need help with investing, banking or financial management, or anything else, we can help. If you are a Trustee and need our help or guidance, please contact us in confidence on 0800 6342 111 or via the contact form on this website – we look forward to hearing from you.

    The Financial Conduct Authority does not regulate trustee advice.

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