There are two ways to pass assets on to beneficiaries:
Lawyers call this the "I love you” way, where you pass assets directly to the person - so someone dies and it goes straight to that person under the will (I don't know why they call it that).
The “testamentary trust” is the other alternative, where instead of passing it directly to the person, it goes into a testamentary trust, and then this person controls that testamentary trust.
Now this is perfect for a couple of reasons. If this person is your risk taker, they will want to own nothing in their own name. So if you've got $1,000,000 here, and you give it to them in their own name, you've just lost asset protection.
So that's an example where we want testamentary trust to protect.
The other one is if you're giving your inheritance to your children. Lets say you don't trust their judgment in terms of the choices they make from a relationship perspective, or you don't know because they might be kids at the moment - If you put it into a testamentary trust, the assets in that trust are protected from relationship breakdown that may happen down the track, or if your spouse remarries, or has a relationship in the future, It protects what you built together from that.
The other benefit of a testamentary trust is that if your beneficiaries have a child, normally when we distribute income to a child under 18 we can only give them about $416, but from a testamentary trust we can give them a lot more. They're taxed like an adult on that income because someone has died to create a testamentary trust.
So there are a number of good reasons why we would recommend testamentary trusts when you're doing your wills. In fact, every single client who's done one with us through the process has built this mechanism in. It's marginally more cost to set up, but I've just explained the pretty cool benefits of it all.