Fixed Interest Trust vs. Discretionary Trust - Which Is Better? (Meaning and Definition)
Channel: Esquire Group
Date: 2022-03-17

Fixed Interest Trust vs. Discretionary Trust - Which Is Better? (Meaning and Definition)

Don't forget to subscribe: https://www.youtube.com/channel/UC9IacrMVN8B_oU5APENiMLw?sub_confirmation=1

Have any questions? Contact us: https://esquiregroup.com/contact/

In today's video, I'll be going over the differences between fixed interest trusts and discretionary trusts, along with which option is more ideal.

Trusts are generally structured as either discretionary, fixed interest, or a combination of the two.

A discretionary trust is a trust where the trustee has discretion in deciding which beneficiary or beneficiaries to distribute to, when, and how much. For example, Joe is the trustee of a trust he set up for the benefit of his 4 children. Joe has full discretion to decide which one(s) of the beneficiaries to distribute to, when, and how much. He could distribute to 1 of them to the exclusion of the others, for example.

In a fixed interest trust, the trustee does not have discretion in deciding which beneficiaries to distribute to, when, and how much. For example, Joe must distribute the income of the trust equally to the beneficiaries each year.

There are also hybrid trusts which combine aspects of discretionary and fixed interest trusts. For example, Joe must distribute equally to the beneficiaries, but he gets decide when and how much.

00:00 Intro
00:35 Disclaimer 
00:55 Discretionary trust example
01:58 Fixed interest trust example 
02:22 Which is better
05:20 Contact info

Thanks for watching! If you found this video to be helpful and informative, feel free to leave a like rating and a comment below, and also subscribe to our channel for more videos like you just watched.

Website: https://esquiregroup.com

About Jimmy Sexton:

Hi! I am Jimmy Sexton, LL.M. - Founder & CEO of Esquire Group. I founded Esquire Group with the objective of helping and inspiring wealthy families, investors, entrepreneurs, and high-level executives obtain and gain control over and protect their wealth, via strategic wealth planning.

Connect with me on LinkedIn: https://www.linkedin.com/in/jimmysextonllm/

Disclaimer:

This video is prepared for educational purposes only. This video is not legal, tax or any other type of advice. Each individuals’ circumstances are different, you should seek legal and/or tax advice to address your specific situation and any questions you may have.