Set-up Disc Trust for non-existent people?

It all depends on how the trust deed is written - trust deeds are generally either quite specific or very broad. It is usually a good idea to go broad in the definition of beneficiary - since adding a beneficiary at a later date could result in the trust being resettled - and you pay stamp duty on the entire value of the trust assets, which could get very expensive.

For example, my discretionary trust defines the class of "general beneficiaries" to include not only my wife and I, but also:

Then it is up to the trustee of the trust to determine which of the beneficiaries actually receives the trust distributions.

We use a corporate trustee, of which my wife and I are shareholders, and in the case that we both die, our wills pass the shares in that corporate trustee to the beneficiaries of our will - and thus they gain control over the actions of that trust with the intention that they then continue to operate the trust for the benefit of the trust beneficiaries.

It's a pretty complex area - so good advice is required ... both in setting up a good discretionary trust and also in getting a good will (if you have a trust - make sure you have a will !!)

 

The idea with the testamentary trust is to make the controllers (trustees) people you trust to look after the beneficiaries. You can hire professionals to do this if you don't have family you trust.

At the end of the day - you are dead - it's no longer your problem, so don't go to great lengths to try and set rules (you generally can't anyway) - situations change and flexibility is often the key.