December 21, 2025 • 43 mins
Often trust have been seen to be province of the uber wealthy. But are they? And often people don't think about this issue until it is too late
So when should we think about these issues - our family. inheritances and what's gonna happen to our money when we aren't around to look after it?
Managing Director for New Zealand Family Trust Services Limited Janet Xuccoa joins Tim Beveridge to give her advice on trust accounts, and how they should be used.
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Episode Transcript
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Speaker 1 (00:09):
You're listening to a podcast from news Talk zed B.
Follow this and a wide range of podcasts now on iHeartRadio.
Speaker 2 (01:45):
Dashing through the snow in a one horse open sleigh,
All the fields we go, laughing all the way, ells
on Bop, tail Ring, Making Spirits, Bride. What fun it
is to ride and sing a sling song to night?
Speaker 3 (02:07):
Jingle Buy Jingle Welcome back to the Weekend Collective. Yeah,
a bit of a retro theme with some of the
music we're playing to this this afternoon. I'm Tim Beverage.
By the way, this is the week in Collective. But
if you hear any of the retro stuff, some of
it is all of it is from an album called
Christmas Cocktails, which I bought it. I bought the CD
(02:28):
of it Donkeys years ago, and it's one of those
go to things. It's just got a nice sort of
feel good sort of you know, retro up tempo sort
of feel to things. And yeah, then I saved it
to Spotify and it is one of my regular go tos,
among other albums of course. But it's called Christmas Cocktails.
If you're curious, I'm looking for it, and I have
no vested interest in it. By the way, just to
share with you anyway, right now, welcome back and if
(02:50):
you've missed any of the ours interesting always fantastic chat
to Allison Gofton about the pre sort of Christmas and
catering and food and ideas like that as well. And
now this is Look. We often have many calls on
the show, but they sometimes people save it till the
end and then they find their miss out. But we
(03:12):
we want your participation. You can jump on the blow
whenever you want if you've got any questions on this
on one hundred and eighty ten eighty or text nine
two nine two for this our smart money and so look.
Of course right now everyone's running around trying to sort
out your last minute shopping not spending too much. But
there is the question that what we're going to explore is,
(03:32):
you know what we want to talk about, what do
you do with the money and wealth that you would
like to either keep in your hot little hands or
maybe have it give to your family once you've gone,
And so trusts that's what we're going to be talking about,
which have often have often are often seen as the
province of the uber wealthy. But are they I mean,
(03:54):
should you be thinking about a trust? When should you
think about a trust inheritances? What's going to happen to
our money when we aren't around look after it? And
how much control can you actually have with your property
once you're out of the picture. So we're going to
talk about that. Should everyone have a family trust? Who
shouldn't worry about it? When do trust? Absolutely make sense?
(04:15):
A huge number of questions around it, But anyway to
discuss that and to take your causes and Dish had
a bit of non specific advice. Of course we don't
give specific financial advice. She is managing director of New
Zealand Family Trust Services Limited and her name is Janet
Zuka and Janet is with me now, Janet High, how are.
Speaker 4 (04:35):
You, hello, Tim, and hello to all of our listeners.
Speaker 3 (04:38):
Christmas to everybody, Yeah, compliments of this. Do you like Christmas?
Speaker 4 (04:40):
I love Christmas?
Speaker 3 (04:43):
Is it just the time of year because we like
the summer? Do you like the sort of decorations? Is
it the food? Is it the giving? What is it?
Speaker 4 (04:50):
I love the cows, I love all the traditions. I
love decorating the tree and you know, to be really honest,
I love the presence.
Speaker 3 (04:58):
Yeah, actually the music. I do love Christmas music. I've
got a daughter who plays music. In fact, I sort
of said, it's not really Christmas, honey, She's love Christmas music,
so she plays it for several months of the year.
But I do quite like at z B. Once first
of December textover, Yeah, that's what.
Speaker 4 (05:17):
Makes you feel happy and bubbly.
Speaker 3 (05:19):
Yeah, I guess so. Yeah. And we've all got our favorites.
Of course, I don't get the Kylie minogue one which
is apparently hit number one. She's got a song on
the Xmas and I listened to it and watched it.
I thought, I have no idea why that's popular. Maybe
it's just because people love Kylie. But anyway, don't even
waste your time people looking at it's just dreadful. Anyway,
let's talk about trusts. How have you been tell us
(05:41):
a bit. I mean, you've been on the ship. We've
had you on the show two or three times now.
I think this is but just for those you haven't
haven't heard you before, tell us a little bit about
you and your background and involvement with trusts.
Speaker 4 (05:53):
So I run New Zealand Family Trust Services, which is
a very large trust provider in New Zealand. Were not
only act as independent trustee for many trusts, but we
also offer an administration service for trust as well. So
sometimes we're not an independent trustee, but we do offer
administration services for my sins. I've got a law degree
(06:15):
and an accounting degree. I'm not carrying current practice certificates
in either of those fields because I don't need to,
but it does make it very helpful because when something
crosses your desk, you look at something and you think,
I think maybe we should have a lawyer on this.
And we had something the other day what appeared to
be a really well written shareholders agreement until I've had
(06:37):
a good read of it and asked the client where
he got that from, and that was care of google
Land and AI, which didn't suit the circumstances at all.
So of course we had to we had to direct
and back to a lawyer to actually get some proper advice.
(06:57):
And it's the same in the accounting field. We had
had another client give us some documentation and when I
looked at that, I just thought, I think we should
really to their accountant because that could trigger all sorts
of tax complications. So the knowledge that I have, although
I'm not carrying carrying compaxes if it doesn't need help,
(07:18):
because you can then direct them back to the right
professionals so that no mistakes occur.
Speaker 3 (07:22):
What got you interested in trusts?
Speaker 4 (07:25):
Ah, it's fascinating. It's intellectually really challenging. Your trusts are
meant are meant to reflect the moral values and standards
of society, and of course that's forever changing. It's an evolution.
And so that brings into the judiciary and with their
court cases and the decisions that they're making, and what
(07:47):
might appear to be incredibly obvious often is not the
law and goes against it goes against how things actually are,
and trust land.
Speaker 3 (07:57):
They're an interesting creation. I remember when I studied equity,
which is the subject we've first introduced to trust. I
think I was quite fascinated just with the fact that
you could create a particular leadlegal entity which vested in someone.
But I'm not going to try and explain trust, but
just the fact that you would have a legal entity
which would be like, it's a legal personal most doesn't
(08:20):
it They explain what a trust is well.
Speaker 4 (08:23):
First off, it's from purely a legal perspective. It is
not a legal entity. It's a relationship. It's a fuduciary relationship.
And people do have feuduciary relationships. We've all got them.
You've got a fuduciary relationship with your doctor. Your doctor
is meant to know better than you, and when you
go to go to them, they are meant to treat
you to the best of their ability. And your interests
(08:45):
are paramount.
Speaker 3 (08:45):
And blubb obligations of good faith.
Speaker 4 (08:47):
Absolutely, and all those sorts of things. And so that's
what trustees are about. Trustees are duties of care and
other duties of course to the beneficiaries, and so they
have a fiduciary relationship to make sure that they are
looking after and serving the beneficiaries in the best way possible.
That's quite loose, by the way, but that's a good
explanation for late people.
Speaker 3 (09:12):
I'd be curious to know what percentage of people who
seek advice about getting a trust are doing it too
late that when they get the advice, they know I
should have done this twenty years.
Speaker 4 (09:25):
A lot of people, a lot of people. I set
up my first trust when I was nineteen, and that
was the very first asset I bought within a trust,
and I think that that's great advice. Not everybody should
have a trust, but you really want to try and
set one up before before you need it. So if
(09:45):
you're going into business, everybody goes into business for instances
with great intentions of being highly successful, so they plan
lots for success, but they never plan for failure. So
you want to You can't set a trust up when
the creditors are knocking down the door and the receivers
about to walk through, So you want to make sure
that whilst you're planning for success, you're also planning that
(10:07):
if there's a rainy day that comes along, that you
are well and truly prepared for that. So trust a
great asset protection devices, but they've got to be put
in place well in advance.
Speaker 3 (10:17):
Yeah, because basically what a trust would do is so
if you've got into a business and it goes bang,
that if you've managed to get your assets into a
trust in a timely manner, then those assets will be protected.
And I guess especially if you're trying to protect the
assets the family home and things like that for your family,
so the creditors don't come and say, hey, mate, with
everything that's yours is ours.
Speaker 4 (10:37):
That's right, and they should indeed do that, but of
course they've got to be run right. So I think
of trust like insurance policy. So if you go and
get an insurance policy on your home, then the insurer
will say we will if your home burns down, we will,
we will pay out and we will reinstate. But you
have to meet certain conditions. So, for example, you've got
to take care as the insurance as insured, so you
(11:00):
can't you can't, for example, I don't know, like a
barbecue in the middle of the lounge. You've got to
meet certain terms and conditions of the insurance policy. So
it's the same with trusts. If you're going to have
a trust and it acts like an insurance policy for
asset protection reasons, you've got to make sure it's run right.
So you can't just set it up, throw it in
the bottom wall and go okay, I'm done now.
Speaker 3 (11:19):
Yeah. Is that what a lot of people do. They
set it up and they just forget about it, and
they forget to I don't know, what do you have.
Speaker 4 (11:25):
They forget your trustee meetings. For example, they forget to
include the independent trustee into the eleventh hour until possibly
maybe they're solicicis, well, have you spoke to the independent
trustee about that? And they don't do that at all,
and so those things really they cause the trust, in
my opinion, to lose integrity.
Speaker 3 (11:44):
Do you need to explain in the establishment of a
trust is there needs to be a record of why
you've established a trust because it's a bit so for instance,
I'm going to use a really funny analogy. Technically, if
you buy in the property world, if you buy a property,
and technically you are buying it to make capital gain,
(12:05):
regardless of how long time has passed, technically you should
pay tax on that capital gain. And that's about your intention.
Is there something when it comes to setting up a
trust that you need to declare The reasons I'm setting
up a trust are sort of for these wonderful, holistic
sort of reasons when really, in fact, you just don't
(12:27):
want your creditors to get hold of that money. If
you are bud we don't.
Speaker 4 (12:31):
We don't put reasons in trustee, okay, but what we
do do we as the settler that's the person that
sets up the trust. Well, often well usually ensured. All
of my clients do they write memoranum wishes and those wishes.
That's that's a document that acts a little bit like
a will. If the if the if the person's not
around anymore, they've if they've you know, if they've departed
(12:53):
planet to a firma then the memorial wishes comes in
place and it says, well, please, trustees do all of
these things with the assets that in the trust. Now
in that memorial wishes document, you could indeed put the
intention there of why you've set it up and what
you want to happen to the to the assets. So
you could put that there if you wanted.
Speaker 3 (13:11):
Well, how can when it come? I mean, are there
sort of I know, the obvious gruncel of this question
is there's no one size that fits all. But are
there generic sort of trusts that would suit many people
in terms of just making basic protection of assets or
are they all quite complex and the way they have
to set it up. It's a bit like you can
(13:31):
but like you can have a will where you basically
just say, look, I mean, my property is going to
my wife and if she predeceases me and my two daughters,
full stop, sign and off, get it witnessed. All that
sort of thing. How complex do you trust. How simple
can they be? There we go, that's I was looking for.
Speaker 4 (13:49):
I suppose the answer is that establishing the trust is
really a matter of process and can be very easy,
but the terms of the trusteed need to fit the
circumstances of what we're dealing with and what we think
we're going to be dealing with in the futures. Most
trusts but we establish New Zealand Family trust services are
(14:12):
discretionary trusts, and so what that means is that trustees
have quite wide powers and beneficiaries are entitled only to
be considered. They're not entitled as a light of anything.
But there's lots of different types of trust.
Speaker 3 (14:27):
Is that the reason there's the reason that you have
a discretionary trust is because you don't want the beneficiaries
to be able to interfere and say, look, I'm the
sole beneficiary of this trust, or we're the only two beneficiaries.
We want to wrap it all up and take the
money now, or I don't know, well, I remember the
(14:49):
cases that where if you're a beneficiary of a long
term trust and you know somebody said, look, we're going
to put this money in trust for you, but the
beneficiaries like I'm the sole beneficiary, and it's usually a
deceased to state. I think that they can sort of
look through it and say, look, I want it all now.
Speaker 4 (15:06):
Well, even in discretionary trust, beneficiaries can band together to
bring the trust to an end.
Speaker 3 (15:12):
Okay, so all.
Speaker 4 (15:13):
The beneficiaries can band together that if they wanted to,
and they can, they can use the trust to act
as a mechanism they could apply to the courts. In fact,
I was having this conversation with a gentleman earlier this
week about that vote point.
Speaker 3 (15:28):
And while they were worried that about keeping putting a
trust together that would last the distance, well.
Speaker 4 (15:34):
Know that what they had got themselves involved in as
a trust, their mother had had the trust actually, and
they had three individuals independent trustees, independent trustees, someone who's
not beneficiary again and layman terms to explain that term.
And so these three professionals were of course doing things
that though beneficiary, which he was was not very happy about.
(15:57):
And my advice to that was really try and call
a meeting with the trustees to understand what they're doing
and why they're doing that and get some communication going.
Speaker 3 (16:05):
So were they acting in a way that the beneficiary
thought was not in the beneficiary's interests.
Speaker 4 (16:10):
I think the beneficiary thought that the way they were
acting was costing a lot of money. Okay, But if
you looked at the assets of the trust and what
he told me, those independent trustees were doing exactly what
they were required to do at law. So I think
they were doing probably a fine job. But because of
(16:32):
the lack of communication, there's a lack of transparency, and
everybody gets a little concerned and worried about that, don't they.
Speaker 3 (16:39):
Okay, we want your calls on this eight hundred eighty
ten eighty if you've got any questions about trusts and
protecting your assets, maybe whether it be while you're alive
because you've got a family home you'd like to protect
and you taking a few risks in business, and or
after you've gone any questions around trusts. The two things
(17:00):
I've just outlined are just a fraction of the landscape
of how diverse trusts can be, of course, but give
us a call. We'd love to hear me on eight
hundred eight e ten eighty. In text on nine two
nine to two. My guest is Janet Zaikarashi's managing director
of New Zealand Family Trust Services. And we'll dig into
lots more questions after this, but you can jump the
gun right now on that number. Oh, eight hundred eighty
(17:22):
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Speaker 1 (18:25):
Your Weekend, Your Way, The Weekend Collective with Tim Beverage
News Talk zebby.
Speaker 3 (18:33):
News Talk z B wherewith Janet Zacara talking trusts. Any
questions you might have and let's get into it, shall
we with Catherine Hello, Hi, Hey guys, good thanks.
Speaker 5 (18:45):
I have a question. My mother has her house and
the trust. Yeah, and she is the set lawn, the
beneficiary and a trustee, but she's wanting to go into
rest home level care. Do you know anything about the
DHB using trust or listing the trust as.
Speaker 6 (19:06):
Part of the.
Speaker 5 (19:09):
For West. Okay, so you have to be under two
hundred and ninety thousand assets. If you have more than that,
then you don't get the DHP funding.
Speaker 3 (19:18):
That's right. And if you've got a lot more than that,
they you have to spend your own money until that's
all you've got.
Speaker 4 (19:23):
Left, right, Yeah, right, yeah, yeah.
Speaker 3 (19:28):
Catherine, I'll go straight to this on Janital on that book.
Speaker 4 (19:31):
Yeah, that's that's a large area of debate so amongst people,
because you might recall that many years ago we were
set out trusts and pretty much we would divest ourselves
of all assets and then we would be almost guaranteed
to get a West term subsidy. And West turn fees
are really they can be really really high.
Speaker 3 (19:53):
So thousands per week, absolutely.
Speaker 4 (19:56):
They can be they can be thousands per week. And
so there are special rules under the Ministry of Social Welfare.
They have special rules on how they evaluate your assets
and wealth. The person that's heading into the rest home,
and indeed if they're in a couple, there's different rules
for that. The rules can be really complicated, and what
I would say is that I would I would get
(20:18):
somebody to really oversee those so either the law your
lawyer who might understand those rules, or even your accountant.
Green Lion is an accounting firm in Parnell, and I
can tell you that they have a few of those
applications come through and the accountants look at that along
with the solicitors, and they work out whether it is
(20:38):
best to carry on with that trust or whether the
assets should really come out and be returned so that
the person can indeed get you know, might be eligible
for a subsidy, because just simply putting the assets in
the trust now will no longer mean that the government
won't look at those trusts at all. They do look
(20:59):
at them, and they look at when you know, when
all the assets went in, what the what gifting was done,
at what time it was.
Speaker 3 (21:06):
Done, suggesting Janet, it's really a case of if you've
done it a decade or more in advance.
Speaker 4 (21:14):
It's potentially potentially And that's and that's why I say
it's worth having your lawyers and your accountants look at
that sort of thing.
Speaker 5 (21:23):
Right, Okay, so there's no seat answer, it's just you've
got to work.
Speaker 3 (21:29):
I certainly no. So yeah, I think Janets. What Janet's
saying is that the fact that there's a trust does
not per se just protect assets and the government goes off, fine,
here's the here's the subsidy.
Speaker 4 (21:40):
And yes, and equally, just because there is a trust,
it doesn't mean that the person's never going to get
a rest time subsidy. I think that it's important that
it's looked at professionally when the application is being made.
That's what I'm trying, That's what I'm trying to trying
to get across.
Speaker 3 (21:57):
How long ago was the trust set up?
Speaker 5 (22:00):
Oh twenty or more years ago, ages ago?
Speaker 4 (22:02):
And I wonder when when they were doing the gifting.
There was a time I think it was about two
thousand and ten when people no longer I mean, you
could always forgive as much debt as you liked, but
you know, center over twenty seven thousand you paid duty
on So do you remember then tim it came in
there was.
Speaker 3 (22:19):
A never law inflation adjusted it's been twenty seven grand
for ages.
Speaker 4 (22:25):
Well, and then you look came in and everybody could
gift as much as they like without paying any duty.
And you had a lot of people do what was
called lump some gifting.
Speaker 3 (22:36):
Except I've seen in because we've got to issue in
our family with this sort of stuff that in the
application for the subsidy, they have their own criteria which
limits gifting to twenty seven thousand a year. So it
doesn't matter what the law says. The rest time subsidy
looks at it in an old school way, absolutely.
Speaker 4 (22:55):
And so so as a consequence of that, when people
lump some gift, they diversed. They divested themselves of all
of their assets there and then, and that can cause
real issues when they're looking at whether they're going to
give a rest home sty or not.
Speaker 3 (23:09):
Because you might have got rid of your assets, but
they behave as if you haven't and you don't have
control over those assets. So gosh, that's yes.
Speaker 4 (23:18):
So that's another reason why trust is so interesting.
Speaker 3 (23:22):
You see, did you get that sort of Catherine, how.
Speaker 4 (23:25):
Complixent it can be?
Speaker 5 (23:26):
Yes, thank you very much. There, I reappreciate it.
Speaker 3 (23:30):
Great call. I mean, I know these are difficult things.
So yeah, So legally you can divest yourselves and of
whatever assets and a lump sum. But when it comes
to the rest time subsidy, they may say not good
enough because we only accept twenty seven thousand.
Speaker 4 (23:49):
A year, and that was back then it was twenty
seven thousand per person. But as soon as that law
change came in, then there was a court case a
few years later and it's twenty seven thousand per carple. Okay, yes,
so the rules change.
Speaker 3 (24:02):
So if you've got a chunk of money, if you've
got a great deal of money, you're really going to
struggle to give away much of that. I mean, hang
on a minute, yes, I mean you could do it
ten years in advance and still only give that's only
twenty seven, two hundred and seventy thousand. So if you've
got millions, yes, good luck with the rest home substitute.
(24:24):
Of course the.
Speaker 4 (24:24):
Argument there as well, if you've got millions, you should
be paying a restaurant care.
Speaker 2 (24:28):
Yeah.
Speaker 4 (24:28):
Wow, you know we're oprahlend of words there with alistons.
Speaker 3 (24:32):
Yeah, I mean I shouldn't have gone millions, but I
mean literally the cook case could be you've simply got
a family home in I don't know, Saint John's.
Speaker 4 (24:40):
And that's what And that's over a million these days.
Speaker 3 (24:43):
Although if one of them still living in the family home.
Speaker 4 (24:46):
True, and there's different rules there. That's which is why
I'm saying, go to the professionals and have a look
at that application with the professional So that's just.
Speaker 3 (24:52):
One call and we see how complex it is. So
let's continue and see where we go. Now with Brendan, Hello,
good good.
Speaker 6 (25:02):
Yes, good good. Look Look I haven't got a trust,
but look I've been in the building trade most of
my life. Look do you use the word At the
beginning of your speel, there was there was devious and
integrity built into you.
Speaker 3 (25:21):
Said, traditional duties and all that.
Speaker 6 (25:25):
If people owe money, and people owe creditors, why should
their assets be protected so they don't pay them. It
just seems like it's shirking their financial responsibilities to pay
their debts. They hide their money and a trust and
(25:45):
then you know, the poor plumber or the or placemakers
or whatever say, should you go us, Oh no, you
can't touch that. It's all on a trust which you
can't touch our house. I mean that that's much. Really,
it's really immoral.
Speaker 3 (26:00):
Well okay, let's but that's a lot of the objections
of people that are such and such. It's good it
all wrapped up in a trust.
Speaker 4 (26:06):
You know.
Speaker 3 (26:07):
Anyway, Janet, what's you.
Speaker 4 (26:09):
And I can understand that perspective. But there's also the
other perspective, Brandon, and that is this if everybody who
who goes into business with the with the best will
in the world, they're not out to, you know, to
rip anybody off. But but but issues happen which may
be no fault of their own. And I'll give you
a little example in a moment. If everybody starts off
(26:32):
like that, then you might get to find that New
Zealand no longer has an entrepreneurial spirit and nobody actually
wants to take the chance of going into business. I'm
going to give you an example of how how somebody
can end up in trouble and it's no fault off
their own.
Speaker 6 (26:47):
That's just that's just an example.
Speaker 4 (26:49):
But I mean, and and our land and our landscape
is littered with them, littered with them, these examples. So
here is an instant where you are in business and
you're going to do business with somebody else and they
can't pay you, and so you end up not being
able to pay you know, your creditors. So it's a
run on effect. Now that's not that's not your fault,
(27:11):
that somebody else has fault possibly, but that's a domino effect.
Speaker 3 (27:16):
It's also pointing out, Brendon, that we do have a
company structure in New Zealand where unless you have been
I mean increasingly they can be looked through. But we
still we have a company structure where you set up
your business, you have the right amount of capital backing
it up, and you go from there. And and the
trust is a step behind that in terms of protecting
the family home and stuff. I mean, it's a funny one.
I can understand what you say, though, I.
Speaker 4 (27:37):
Mean, I see two sides to the argument.
Speaker 6 (27:41):
Yeah, is that you know, you get these people that
are owned you know, you know, a million dollars and
they get ten cents from a dollar or something, you know,
because it's all the rest is in the trust and
they and they've still got there a couple of homes
in their beach place and there you know, luxury cars
and those people. Yeah, the people that are owned Bodley Squat.
Speaker 5 (28:05):
Really.
Speaker 3 (28:05):
Yeah, It's it's constantly a trick, key ethical issue, and
I think you know, there are a lot of people
listening to I mean there It is a tricky issue
because you do get people who you know, that are
the creditors through no fauld of their own. They're the
ones who get left out of pocket.
Speaker 4 (28:18):
Whereas yeah, as I say, I can unders I can
understand both both sides of the coin in an issue
like that. But I can assure you the trust that
we set up and that we're involved in the people
behind those trusts are genuine, genuine people that are in
business and want to do well in business.
Speaker 3 (28:38):
I think the thing is is that often high profile
there are hope, high profile cases where you think, got
somebody's company's gone bying and they're still cruising around in
a Lamborghini and all their creditors have been unpaid and
stuff and we can all think of examples where we go, well,
that's just something's wrong there.
Speaker 4 (28:55):
Yes, yeah, and I do take do take the point.
Speaker 3 (28:59):
But it's probably worth pointing out that there is quite
a hope there's some high profile cases where people may
have been looking like they've been leaving high in the hog,
but actually the government's looking through their business dealings and
whether they've behaved in the right manner and they actually
are actually getting a certain come up. And it's without
mentioning names, but we can always imagine certain cases which
attract our attention in that respect. But you know what
(29:19):
we have to do next before we go to Jody.
Is we going to take a quick break? Oh eight
hundred eight ten eighty twenty three minutes to six, Yes,
News Talk. Se'd be with Tim Beverage. My guest is
Janet Zuccoa. She's managing director of New Zealand Family Trust
Services Limited, talking about trusts. Any questions you've gotten, As
(29:42):
I say, you got to get in early because we'll
run out of time. But let's go to Jody.
Speaker 5 (29:47):
Hello, Hello, Hello, you good.
Speaker 3 (29:50):
Thanks.
Speaker 7 (29:51):
I have a family, a trust in that my father's
house when he passed away was left in a living
trust for me to be able to live in and
to have financial benefit from an example, to rent to
the house, and then when I pass, it goes to
(30:11):
my three children, who are who I suppose are the owners.
So in effect, I'm maintaining a property for the benefit
benefit of my children, which is a great thing.
Speaker 4 (30:22):
You're a life benefit, I'm sure you aren't you, Jody.
You know you've got like a life interest in it.
Speaker 7 (30:27):
A life interest, that's right, And it does seem like
a burden at times. It feels like I'm maintaining this
property for the benefits Further down the track, one of
my children is old enough now, they've just graduated with
quite a prominent you know, a good sensible degree and
(30:52):
can earn enough money. I'd like to know whether I
can draw on the the assets the equity in this
house and be able to use that for who to
be able to buy another property, to be able to
set her up before I die, because I'm quite good
(31:14):
health at the moment, so I'm not planning on popping
the cross anytime soon. So i want to know how
good damn how do I benefit my children?
Speaker 4 (31:26):
Depend on the terms of the trusteed, So you'll need
you'll need somebody to read that trusteed and really help you,
help you through that to see what could actually be
done using the assets now to benefit the beneficiaries.
Speaker 3 (31:45):
Who set the trust up.
Speaker 7 (31:48):
My father set the trust up, and he did it
in this way, I think because my partner wasn't very
good with business. He was about to go bankrupt, and
I was really worried that I would be bullied and
pressured and.
Speaker 5 (32:02):
To be having put.
Speaker 7 (32:06):
Exactly And that was a very real and.
Speaker 4 (32:09):
That's another reason why why we have trust. We are
going to have a massive transfer of wealth from generations
in the next twenty odd years, and a lot of
people are worried. A lot of parents are worried that
when the wealth transfers to their children who are who
are adults, but we'll call them children who are who
are children, that should anything happen in the child's relationship,
(32:32):
that the inheritance goes sidewards, that it's you know, it's
fifty to fifty and you do that a couple of times,
and you know you end up with them.
Speaker 3 (32:40):
About fifteen percent consent. Yeah, Actually, there'll be a lot
of eccet your your kids. They are actually beneficial beneficiaries.
You are the life beneficiary sort of whose interest precedes them.
Speaker 4 (32:56):
Yeah. Yeah, so I think what JODI's saying is she
gets the use of the assets, but they're really her
held in preservation ultimately for the final beneficiaries, which which
from this conversation appeared to be the three children.
Speaker 3 (33:09):
Because sometimes an example of that would be, for instance,
you might be the life beneficiary of a property, so
you basically the family home goes to Jody and her
children get to benefit later on. Can that create problems
with Jodie's like, well, that's very nice, but I'd like
to sell this and get a different house.
Speaker 4 (33:28):
Well, it can, but again the terms of the trusteed
may well be wide enough to permit.
Speaker 7 (33:34):
It, okay, And there are allowances for when I become
a little old lady if this property isn't suitable, one
can be secure. But of course, to financially help the
children into their own homes, yes, before say they're in
their late forties.
Speaker 8 (33:52):
Yeah, that's the real question.
Speaker 4 (33:55):
That's a very good point. So a lot of parents
are you know, are doing that these days. In fact,
I've just written an article on that. It's going to
be on our website in the next three days. But
I've just written that article on how to help your
children and to enter a home, and it may well
be using a trust so that your pets, so that
the parents giving the money or providing providing the werewall
(34:17):
to as a deposit or even a large large portion
of the purchase price, can ensure that it is protected
in relationship times.
Speaker 3 (34:25):
Yeah, so it looks like you'll need to get a
bit of advice on the text of that trust there, Jodi.
But it might be doable.
Speaker 4 (34:31):
Maybe doable.
Speaker 3 (34:32):
Yeah, good on your Jody, really appreciate your call on that.
Let's go to Emma.
Speaker 8 (34:39):
Hello, Hi, Hi guys, Hey, this might be how long
is a piece of string cup question? Jenna. I'm just
wondering if you've got original settler pass trusted up about
nineteen props at nineteen years ago. Three trustees that have
been there ever since the original settler's dead, four beneficiaries.
(35:00):
One beneficiary has taken umbrage with the way the trust
has been run. How long? And you've got two cases
slugging it out. A lawyer friend of mine set these
people that make the money. Here are the lawyers it's
been slugged at? How long? How long years can you
expect it to go on? I know it's a bit
of a piece of strength, you know, but really within reason,
you know, like how long?
Speaker 9 (35:23):
It's not that quock be another.
Speaker 3 (35:25):
Way to phrase the question, how quickly could we hope
to have it sorted well?
Speaker 8 (35:29):
With the new laws that came out twenty nineteen. Surely
it's a lot clearer now, isn't it. I mean, it's
not that complex if you specialize in it. I don't
get so the legislation.
Speaker 4 (35:39):
Has indeed helped us. It has helped us, and in
that regard, it has strength and beneficiaries rights, and it's
how trustees, especially professional trustees, independent trustees, more accountable. And
it does provide mechanisms for example if, for instance, if
people can't agree, then there is always the result to
(36:01):
the courts. But I'd like to think that professional trustees
can sit down and have national conversations. And if it's
beneficiaries or odds with each other, then really trustees can
call meetings with beneficiaries and say well, this is what
we're tabling and this is the reason why.
Speaker 8 (36:17):
So it's not happening though you've got two cases, like
I say, slugging it out and.
Speaker 4 (36:21):
Other other trustees independent trustees where they also beneficiaries of.
Speaker 8 (36:25):
The trust independent one is not though, so.
Speaker 4 (36:29):
So one is a trustee beneficiary? Is that correct?
Speaker 7 (36:32):
Yes?
Speaker 8 (36:32):
Yes, I'm just thinking how long, you know, really and
truly what's reasonable? I guess it could go for years,
couldn't it that regard.
Speaker 3 (36:40):
Astronomical The cost would be dreadful.
Speaker 4 (36:43):
I would think if it goes on and on like that.
But in that regard, if it's only one beneficiary, the
trustees have a duty to all of the beneficiaries. So
to a degree, the trustees have to step in and
try and bring some resolution to matters. I would have.
Speaker 8 (36:59):
Thought, mm, okay, yeah, I'm just.
Speaker 4 (37:06):
What what what can you call them eating with the trustees?
Speaker 8 (37:11):
M yes, yes, but yeah, just one is not, so
I can't say too much. But it's just interesting. I
just thought, you know, as an outsider, because I loved
law and looking at it, and it's just being involved
as well though. I was just thinking, how long can
this possibly go on? You know? Like I said, the
only people making all the money in the moment of
the two cases, yes.
Speaker 3 (37:29):
Involved, but like most animosity and divorces, I think the
only one is out of those.
Speaker 4 (37:38):
Matters can indeed be they can be helped either by
the courts or buy mediation. But in the very first instance,
I like to think that the trustees will sit down
because they and have a good chatter, because they they
do have duties to all beneficiaries, not just one beneficiary.
Speaker 8 (37:55):
Yeah, sorry, you benefit.
Speaker 3 (37:57):
What's your position here?
Speaker 8 (37:58):
I don't want to say too much. I really don't.
Not not on there, and if that can't work, then
the courts will sort it out pronto, hopefully, you know.
Speaker 3 (38:06):
I do have just why you're on the line. I
just asked this question. I mean, could M speak to
without you know, as since you talk to the cass
But is there a way of MS seeking advice from
somebod who's just you know, knows a few things about
trust to have a look at it? I mean, could
they talk, could she talk to you? Or you could?
Speaker 4 (38:24):
Indeed you've you know, our company, New Zealand Family Trust Services.
So in the first instance, I do take a lot
of course from people and then can help them a
little bit along their way.
Speaker 3 (38:34):
And you can manage that as well if you want to.
That's my suggestion, by the way, not not janets the MS.
So if you want to if you want to.
Speaker 4 (38:41):
Seek some advice right place, if you've got a great
lawyer who knows about trust, so I would have a
chat to them.
Speaker 8 (38:48):
Yeah, so you would say it's pretty specialized. Feel thank
you very much. And guys, okay, thank you appreciate it.
Speaker 3 (38:53):
These just as every time we get you on I
sort of think, God, this is actually quite fascinating this stuff.
We could talk for quite a long time, but unfortunately
we don't have much time, but we'll come back. We'll
see if we can squeeze on a call with Ryan
before we wrap things up. It is very quick call.
It is ten and a half minutes to six news talks.
He'd be it's time to squeeze it. One more call
(39:26):
with Janet's ACA from New Zealand Family Trust Services. By
the way, if you do want to actually get some
advice on trust, you're welcome to get in touch with
New Zealand Family Trust Services and asked for Janet and
I'm sure she'd love to help you. But anyway, let's
see if we can squeeze in one more quick bit
of advice or help not we're not personalized advice, of course, Ryan, Ullo.
Speaker 9 (39:43):
Sam, how are good. Thanks, good. I'm just bringing So
I was recently contacted by a family friend who just
in conversation let me know that I was going to
be I am his trustee for two of his trusts.
And I don't really know what to say about that
or how I felt about that. But I suppose my
(40:06):
question is should I I want to find out from
him what the details of the trusts are in all
that sort of stuff, or.
Speaker 4 (40:15):
Can I just understand that again? So your your friend
said that you are a trustee of the trust or
did he say you were bene fishery of the trust?
Speaker 9 (40:26):
He said, I'll be the trust trustee.
Speaker 4 (40:28):
You're going to be the trustee or you are the
trustee now I am. Now, Well, if you were a
trustee now, you would have had to assigned documentation. Okay,
that's the first thing I had to now. Okay, So
you would have had to sign documentation. And then you
will be bound by the trust out twenty nineteen and
(40:49):
of course or the common law, and there will be
various things that you will need to be doing. A
quick example of that is that you will need to
know what consists of the trust fund and be dealing
with that appropriately. But I can't see how you could
be a trustee if you've never signed anything.
Speaker 3 (41:05):
Is this person your friend?
Speaker 4 (41:08):
Is it?
Speaker 3 (41:08):
Because are they saying that they've got you in their
will as someone who's going to be having some responsibility
or something, or is it about it literally a trust
they say they've set up now.
Speaker 9 (41:19):
So he's had some trust and he's had trusts, he's
had some falling out with some. Fairly, I guess, and
I guess I'm the closest thing is something at the moment.
And maybe I guess maybe I interpreted it wrong that
I'll go in to.
Speaker 3 (41:35):
Be one or you might need to seek seek some
clarity from it.
Speaker 4 (41:39):
But yes, so be very clear what exactly you are
now and what he wants you to do in the future.
But if you are a trustee, you do indeed have
duties now to attend to.
Speaker 9 (41:50):
Yeah, because I was wondering whether I needed to find
out what the details of it.
Speaker 3 (41:54):
And yeah, absolutely, yeah, Sorry, we can't add for more
help with theirs with it shorter time. I did want
to answer this quick text says Tim. We have a
trust as we have a business. We only have a
family home and the trust as it's our only asset.
It costs us approximately a thousand bucks a year to
run it. Should we keep it? Not specific financial advice,
but I would tend to think if you've gone to
(42:16):
the trouble of keeping your house and a trust, I
would tend to keep it.
Speaker 4 (42:19):
Miss And if you're in business, yes, so that is
your that's your insurance policy that I was talking about before.
That's the asset protection, providing that it's actually run quickly.
We for for our fees were six hundred and ninety
five a year, and we hold an annual trustee meeting
with that, so I guess that's a little bit cheaper.
It's pretty important to make sure that things are done
(42:40):
annually to ensure the trust retains its integrity and stands
up should anything happen in that business.
Speaker 3 (42:46):
I probably wouldn't hurt to get a little bit of
advice from someone who's maybe not one of the trustees. Now,
just get some advice from someone about about why you
might want to keep it. That's all we can do.
But time flies, Janet, doesn't that mean at the end
of it.
Speaker 4 (43:03):
Yeah, Married Christmas to you, Tim, and Merry Christmas to
all of our listeners. I hope you have a really
joyous and peaceful Christmas.
Speaker 3 (43:12):
Indeed, And if you want to New Zealand Family Trust Services,
that's Janet Zuka z U c CooA. And thanks for
my producer Lock. Good job Lock, and I'll catch I'll
catch it tomorrow morning at nine o'clock the Christmas Christmas
Conveyor Belt starts. We'll catch you tomorrow. Open that bag.
Speaker 1 (43:44):
For more from News Talk zed B. Listen live on
air or online, and keep our shows with you wherever
you go with our podcast on iHeartRadio
You're listening to a podcast from news Talk zed B.
Follow this and a wide range of podcasts now on iHeartRadio.
Speaker 2 (01:45):
Dashing through the snow in a one horse open sleigh,
All the fields we go, laughing all the way, ells
on Bop, tail Ring, Making Spirits, Bride. What fun it
is to ride and sing a sling song to night?
Speaker 3 (02:07):
Jingle Buy Jingle Welcome back to the Weekend Collective. Yeah,
a bit of a retro theme with some of the
music we're playing to this this afternoon. I'm Tim Beverage.
By the way, this is the week in Collective. But
if you hear any of the retro stuff, some of
it is all of it is from an album called
Christmas Cocktails, which I bought it. I bought the CD
(02:28):
of it Donkeys years ago, and it's one of those
go to things. It's just got a nice sort of
feel good sort of you know, retro up tempo sort
of feel to things. And yeah, then I saved it
to Spotify and it is one of my regular go tos,
among other albums of course. But it's called Christmas Cocktails.
If you're curious, I'm looking for it, and I have
no vested interest in it. By the way, just to
share with you anyway, right now, welcome back and if
(02:50):
you've missed any of the ours interesting always fantastic chat
to Allison Gofton about the pre sort of Christmas and
catering and food and ideas like that as well. And
now this is Look. We often have many calls on
the show, but they sometimes people save it till the
end and then they find their miss out. But we
(03:12):
we want your participation. You can jump on the blow
whenever you want if you've got any questions on this
on one hundred and eighty ten eighty or text nine
two nine two for this our smart money and so look.
Of course right now everyone's running around trying to sort
out your last minute shopping not spending too much. But
there is the question that what we're going to explore is,
(03:32):
you know what we want to talk about, what do
you do with the money and wealth that you would
like to either keep in your hot little hands or
maybe have it give to your family once you've gone,
And so trusts that's what we're going to be talking about,
which have often have often are often seen as the
province of the uber wealthy. But are they I mean,
(03:54):
should you be thinking about a trust? When should you
think about a trust inheritances? What's going to happen to
our money when we aren't around look after it? And
how much control can you actually have with your property
once you're out of the picture. So we're going to
talk about that. Should everyone have a family trust? Who
shouldn't worry about it? When do trust? Absolutely make sense?
(04:15):
A huge number of questions around it, But anyway to
discuss that and to take your causes and Dish had
a bit of non specific advice. Of course we don't
give specific financial advice. She is managing director of New
Zealand Family Trust Services Limited and her name is Janet
Zuka and Janet is with me now, Janet High, how are.
Speaker 4 (04:35):
You, hello, Tim, and hello to all of our listeners.
Speaker 3 (04:38):
Christmas to everybody, Yeah, compliments of this. Do you like Christmas?
Speaker 4 (04:40):
I love Christmas?
Speaker 3 (04:43):
Is it just the time of year because we like
the summer? Do you like the sort of decorations? Is
it the food? Is it the giving? What is it?
Speaker 4 (04:50):
I love the cows, I love all the traditions. I
love decorating the tree and you know, to be really honest,
I love the presence.
Speaker 3 (04:58):
Yeah, actually the music. I do love Christmas music. I've
got a daughter who plays music. In fact, I sort
of said, it's not really Christmas, honey, She's love Christmas music,
so she plays it for several months of the year.
But I do quite like at z B. Once first
of December textover, Yeah, that's what.
Speaker 4 (05:17):
Makes you feel happy and bubbly.
Speaker 3 (05:19):
Yeah, I guess so. Yeah. And we've all got our favorites.
Of course, I don't get the Kylie minogue one which
is apparently hit number one. She's got a song on
the Xmas and I listened to it and watched it.
I thought, I have no idea why that's popular. Maybe
it's just because people love Kylie. But anyway, don't even
waste your time people looking at it's just dreadful. Anyway,
let's talk about trusts. How have you been tell us
(05:41):
a bit. I mean, you've been on the ship. We've
had you on the show two or three times now.
I think this is but just for those you haven't
haven't heard you before, tell us a little bit about
you and your background and involvement with trusts.
Speaker 4 (05:53):
So I run New Zealand Family Trust Services, which is
a very large trust provider in New Zealand. Were not
only act as independent trustee for many trusts, but we
also offer an administration service for trust as well. So
sometimes we're not an independent trustee, but we do offer
administration services for my sins. I've got a law degree
(06:15):
and an accounting degree. I'm not carrying current practice certificates
in either of those fields because I don't need to,
but it does make it very helpful because when something
crosses your desk, you look at something and you think,
I think maybe we should have a lawyer on this.
And we had something the other day what appeared to
be a really well written shareholders agreement until I've had
(06:37):
a good read of it and asked the client where
he got that from, and that was care of google
Land and AI, which didn't suit the circumstances at all.
So of course we had to we had to direct
and back to a lawyer to actually get some proper advice.
(06:57):
And it's the same in the accounting field. We had
had another client give us some documentation and when I
looked at that, I just thought, I think we should
really to their accountant because that could trigger all sorts
of tax complications. So the knowledge that I have, although
I'm not carrying carrying compaxes if it doesn't need help,
(07:18):
because you can then direct them back to the right
professionals so that no mistakes occur.
Speaker 3 (07:22):
What got you interested in trusts?
Speaker 4 (07:25):
Ah, it's fascinating. It's intellectually really challenging. Your trusts are
meant are meant to reflect the moral values and standards
of society, and of course that's forever changing. It's an evolution.
And so that brings into the judiciary and with their
court cases and the decisions that they're making, and what
(07:47):
might appear to be incredibly obvious often is not the
law and goes against it goes against how things actually are,
and trust land.
Speaker 3 (07:57):
They're an interesting creation. I remember when I studied equity,
which is the subject we've first introduced to trust. I
think I was quite fascinated just with the fact that
you could create a particular leadlegal entity which vested in someone.
But I'm not going to try and explain trust, but
just the fact that you would have a legal entity
which would be like, it's a legal personal most doesn't
(08:20):
it They explain what a trust is well.
Speaker 4 (08:23):
First off, it's from purely a legal perspective. It is
not a legal entity. It's a relationship. It's a fuduciary relationship.
And people do have feuduciary relationships. We've all got them.
You've got a fuduciary relationship with your doctor. Your doctor
is meant to know better than you, and when you
go to go to them, they are meant to treat
you to the best of their ability. And your interests
(08:45):
are paramount.
Speaker 3 (08:45):
And blubb obligations of good faith.
Speaker 4 (08:47):
Absolutely, and all those sorts of things. And so that's
what trustees are about. Trustees are duties of care and
other duties of course to the beneficiaries, and so they
have a fiduciary relationship to make sure that they are
looking after and serving the beneficiaries in the best way possible.
That's quite loose, by the way, but that's a good
explanation for late people.
Speaker 3 (09:12):
I'd be curious to know what percentage of people who
seek advice about getting a trust are doing it too
late that when they get the advice, they know I
should have done this twenty years.
Speaker 4 (09:25):
A lot of people, a lot of people. I set
up my first trust when I was nineteen, and that
was the very first asset I bought within a trust,
and I think that that's great advice. Not everybody should
have a trust, but you really want to try and
set one up before before you need it. So if
(09:45):
you're going into business, everybody goes into business for instances
with great intentions of being highly successful, so they plan
lots for success, but they never plan for failure. So
you want to You can't set a trust up when
the creditors are knocking down the door and the receivers
about to walk through, So you want to make sure
that whilst you're planning for success, you're also planning that
(10:07):
if there's a rainy day that comes along, that you
are well and truly prepared for that. So trust a
great asset protection devices, but they've got to be put
in place well in advance.
Speaker 3 (10:17):
Yeah, because basically what a trust would do is so
if you've got into a business and it goes bang,
that if you've managed to get your assets into a
trust in a timely manner, then those assets will be protected.
And I guess especially if you're trying to protect the
assets the family home and things like that for your family,
so the creditors don't come and say, hey, mate, with
everything that's yours is ours.
Speaker 4 (10:37):
That's right, and they should indeed do that, but of
course they've got to be run right. So I think
of trust like insurance policy. So if you go and
get an insurance policy on your home, then the insurer
will say we will if your home burns down, we will,
we will pay out and we will reinstate. But you
have to meet certain conditions. So, for example, you've got
to take care as the insurance as insured, so you
(11:00):
can't you can't, for example, I don't know, like a
barbecue in the middle of the lounge. You've got to
meet certain terms and conditions of the insurance policy. So
it's the same with trusts. If you're going to have
a trust and it acts like an insurance policy for
asset protection reasons, you've got to make sure it's run right.
So you can't just set it up, throw it in
the bottom wall and go okay, I'm done now.
Speaker 3 (11:19):
Yeah. Is that what a lot of people do. They
set it up and they just forget about it, and
they forget to I don't know, what do you have.
Speaker 4 (11:25):
They forget your trustee meetings. For example, they forget to
include the independent trustee into the eleventh hour until possibly
maybe they're solicicis, well, have you spoke to the independent
trustee about that? And they don't do that at all,
and so those things really they cause the trust, in
my opinion, to lose integrity.
Speaker 3 (11:44):
Do you need to explain in the establishment of a
trust is there needs to be a record of why
you've established a trust because it's a bit so for instance,
I'm going to use a really funny analogy. Technically, if
you buy in the property world, if you buy a property,
and technically you are buying it to make capital gain,
(12:05):
regardless of how long time has passed, technically you should
pay tax on that capital gain. And that's about your intention.
Is there something when it comes to setting up a
trust that you need to declare The reasons I'm setting
up a trust are sort of for these wonderful, holistic
sort of reasons when really, in fact, you just don't
(12:27):
want your creditors to get hold of that money. If
you are bud we don't.
Speaker 4 (12:31):
We don't put reasons in trustee, okay, but what we
do do we as the settler that's the person that
sets up the trust. Well, often well usually ensured. All
of my clients do they write memoranum wishes and those wishes.
That's that's a document that acts a little bit like
a will. If the if the if the person's not
around anymore, they've if they've you know, if they've departed
(12:53):
planet to a firma then the memorial wishes comes in
place and it says, well, please, trustees do all of
these things with the assets that in the trust. Now
in that memorial wishes document, you could indeed put the
intention there of why you've set it up and what
you want to happen to the to the assets. So
you could put that there if you wanted.
Speaker 3 (13:11):
Well, how can when it come? I mean, are there
sort of I know, the obvious gruncel of this question
is there's no one size that fits all. But are
there generic sort of trusts that would suit many people
in terms of just making basic protection of assets or
are they all quite complex and the way they have
to set it up. It's a bit like you can
(13:31):
but like you can have a will where you basically
just say, look, I mean, my property is going to
my wife and if she predeceases me and my two daughters,
full stop, sign and off, get it witnessed. All that
sort of thing. How complex do you trust. How simple
can they be? There we go, that's I was looking for.
Speaker 4 (13:49):
I suppose the answer is that establishing the trust is
really a matter of process and can be very easy,
but the terms of the trusteed need to fit the
circumstances of what we're dealing with and what we think
we're going to be dealing with in the futures. Most
trusts but we establish New Zealand Family trust services are
(14:12):
discretionary trusts, and so what that means is that trustees
have quite wide powers and beneficiaries are entitled only to
be considered. They're not entitled as a light of anything.
But there's lots of different types of trust.
Speaker 3 (14:27):
Is that the reason there's the reason that you have
a discretionary trust is because you don't want the beneficiaries
to be able to interfere and say, look, I'm the
sole beneficiary of this trust, or we're the only two beneficiaries.
We want to wrap it all up and take the
money now, or I don't know, well, I remember the
(14:49):
cases that where if you're a beneficiary of a long
term trust and you know somebody said, look, we're going
to put this money in trust for you, but the
beneficiaries like I'm the sole beneficiary, and it's usually a
deceased to state. I think that they can sort of
look through it and say, look, I want it all now.
Speaker 4 (15:06):
Well, even in discretionary trust, beneficiaries can band together to
bring the trust to an end.
Speaker 3 (15:12):
Okay, so all.
Speaker 4 (15:13):
The beneficiaries can band together that if they wanted to,
and they can, they can use the trust to act
as a mechanism they could apply to the courts. In fact,
I was having this conversation with a gentleman earlier this
week about that vote point.
Speaker 3 (15:28):
And while they were worried that about keeping putting a
trust together that would last the distance, well.
Speaker 4 (15:34):
Know that what they had got themselves involved in as
a trust, their mother had had the trust actually, and
they had three individuals independent trustees, independent trustees, someone who's
not beneficiary again and layman terms to explain that term.
And so these three professionals were of course doing things
that though beneficiary, which he was was not very happy about.
(15:57):
And my advice to that was really try and call
a meeting with the trustees to understand what they're doing
and why they're doing that and get some communication going.
Speaker 3 (16:05):
So were they acting in a way that the beneficiary
thought was not in the beneficiary's interests.
Speaker 4 (16:10):
I think the beneficiary thought that the way they were
acting was costing a lot of money. Okay, But if
you looked at the assets of the trust and what
he told me, those independent trustees were doing exactly what
they were required to do at law. So I think
they were doing probably a fine job. But because of
(16:32):
the lack of communication, there's a lack of transparency, and
everybody gets a little concerned and worried about that, don't they.
Speaker 3 (16:39):
Okay, we want your calls on this eight hundred eighty
ten eighty if you've got any questions about trusts and
protecting your assets, maybe whether it be while you're alive
because you've got a family home you'd like to protect
and you taking a few risks in business, and or
after you've gone any questions around trusts. The two things
(17:00):
I've just outlined are just a fraction of the landscape
of how diverse trusts can be, of course, but give
us a call. We'd love to hear me on eight
hundred eight e ten eighty. In text on nine two
nine to two. My guest is Janet Zaikarashi's managing director
of New Zealand Family Trust Services. And we'll dig into
lots more questions after this, but you can jump the
gun right now on that number. Oh, eight hundred eighty
(17:22):
ten eighty. It's twenty two past five. News Talk SEDB. Yes,
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Speaker 1 (18:25):
Your Weekend, Your Way, The Weekend Collective with Tim Beverage
News Talk zebby.
Speaker 3 (18:33):
News Talk z B wherewith Janet Zacara talking trusts. Any
questions you might have and let's get into it, shall
we with Catherine Hello, Hi, Hey guys, good thanks.
Speaker 5 (18:45):
I have a question. My mother has her house and
the trust. Yeah, and she is the set lawn, the
beneficiary and a trustee, but she's wanting to go into
rest home level care. Do you know anything about the
DHB using trust or listing the trust as.
Speaker 6 (19:06):
Part of the.
Speaker 5 (19:09):
For West. Okay, so you have to be under two
hundred and ninety thousand assets. If you have more than that,
then you don't get the DHP funding.
Speaker 3 (19:18):
That's right. And if you've got a lot more than that,
they you have to spend your own money until that's
all you've got.
Speaker 4 (19:23):
Left, right, Yeah, right, yeah, yeah.
Speaker 3 (19:28):
Catherine, I'll go straight to this on Janital on that book.
Speaker 4 (19:31):
Yeah, that's that's a large area of debate so amongst people,
because you might recall that many years ago we were
set out trusts and pretty much we would divest ourselves
of all assets and then we would be almost guaranteed
to get a West term subsidy. And West turn fees
are really they can be really really high.
Speaker 3 (19:53):
So thousands per week, absolutely.
Speaker 4 (19:56):
They can be they can be thousands per week. And
so there are special rules under the Ministry of Social Welfare.
They have special rules on how they evaluate your assets
and wealth. The person that's heading into the rest home,
and indeed if they're in a couple, there's different rules
for that. The rules can be really complicated, and what
I would say is that I would I would get
(20:18):
somebody to really oversee those so either the law your
lawyer who might understand those rules, or even your accountant.
Green Lion is an accounting firm in Parnell, and I
can tell you that they have a few of those
applications come through and the accountants look at that along
with the solicitors, and they work out whether it is
(20:38):
best to carry on with that trust or whether the
assets should really come out and be returned so that
the person can indeed get you know, might be eligible
for a subsidy, because just simply putting the assets in
the trust now will no longer mean that the government
won't look at those trusts at all. They do look
(20:59):
at them, and they look at when you know, when
all the assets went in, what the what gifting was done,
at what time it was.
Speaker 3 (21:06):
Done, suggesting Janet, it's really a case of if you've
done it a decade or more in advance.
Speaker 4 (21:14):
It's potentially potentially And that's and that's why I say
it's worth having your lawyers and your accountants look at
that sort of thing.
Speaker 5 (21:23):
Right, Okay, so there's no seat answer, it's just you've
got to work.
Speaker 3 (21:29):
I certainly no. So yeah, I think Janets. What Janet's
saying is that the fact that there's a trust does
not per se just protect assets and the government goes off, fine,
here's the here's the subsidy.
Speaker 4 (21:40):
And yes, and equally, just because there is a trust,
it doesn't mean that the person's never going to get
a rest time subsidy. I think that it's important that
it's looked at professionally when the application is being made.
That's what I'm trying, That's what I'm trying to trying
to get across.
Speaker 3 (21:57):
How long ago was the trust set up?
Speaker 5 (22:00):
Oh twenty or more years ago, ages ago?
Speaker 4 (22:02):
And I wonder when when they were doing the gifting.
There was a time I think it was about two
thousand and ten when people no longer I mean, you
could always forgive as much debt as you liked, but
you know, center over twenty seven thousand you paid duty
on So do you remember then tim it came in
there was.
Speaker 3 (22:19):
A never law inflation adjusted it's been twenty seven grand
for ages.
Speaker 4 (22:25):
Well, and then you look came in and everybody could
gift as much as they like without paying any duty.
And you had a lot of people do what was
called lump some gifting.
Speaker 3 (22:36):
Except I've seen in because we've got to issue in
our family with this sort of stuff that in the
application for the subsidy, they have their own criteria which
limits gifting to twenty seven thousand a year. So it
doesn't matter what the law says. The rest time subsidy
looks at it in an old school way, absolutely.
Speaker 4 (22:55):
And so so as a consequence of that, when people
lump some gift, they diversed. They divested themselves of all
of their assets there and then, and that can cause
real issues when they're looking at whether they're going to
give a rest home sty or not.
Speaker 3 (23:09):
Because you might have got rid of your assets, but
they behave as if you haven't and you don't have
control over those assets. So gosh, that's yes.
Speaker 4 (23:18):
So that's another reason why trust is so interesting.
Speaker 3 (23:22):
You see, did you get that sort of Catherine, how.
Speaker 4 (23:25):
Complixent it can be?
Speaker 5 (23:26):
Yes, thank you very much. There, I reappreciate it.
Speaker 3 (23:30):
Great call. I mean, I know these are difficult things.
So yeah, So legally you can divest yourselves and of
whatever assets and a lump sum. But when it comes
to the rest time subsidy, they may say not good
enough because we only accept twenty seven thousand.
Speaker 4 (23:49):
A year, and that was back then it was twenty
seven thousand per person. But as soon as that law
change came in, then there was a court case a
few years later and it's twenty seven thousand per carple. Okay, yes,
so the rules change.
Speaker 3 (24:02):
So if you've got a chunk of money, if you've
got a great deal of money, you're really going to
struggle to give away much of that. I mean, hang
on a minute, yes, I mean you could do it
ten years in advance and still only give that's only
twenty seven, two hundred and seventy thousand. So if you've
got millions, yes, good luck with the rest home substitute.
(24:24):
Of course the.
Speaker 4 (24:24):
Argument there as well, if you've got millions, you should
be paying a restaurant care.
Speaker 2 (24:28):
Yeah.
Speaker 4 (24:28):
Wow, you know we're oprahlend of words there with alistons.
Speaker 3 (24:32):
Yeah, I mean I shouldn't have gone millions, but I
mean literally the cook case could be you've simply got
a family home in I don't know, Saint John's.
Speaker 4 (24:40):
And that's what And that's over a million these days.
Speaker 3 (24:43):
Although if one of them still living in the family home.
Speaker 4 (24:46):
True, and there's different rules there. That's which is why
I'm saying, go to the professionals and have a look
at that application with the professional So that's just.
Speaker 3 (24:52):
One call and we see how complex it is. So
let's continue and see where we go. Now with Brendan, Hello,
good good.
Speaker 6 (25:02):
Yes, good good. Look Look I haven't got a trust,
but look I've been in the building trade most of
my life. Look do you use the word At the
beginning of your speel, there was there was devious and
integrity built into you.
Speaker 3 (25:21):
Said, traditional duties and all that.
Speaker 6 (25:25):
If people owe money, and people owe creditors, why should
their assets be protected so they don't pay them. It
just seems like it's shirking their financial responsibilities to pay
their debts. They hide their money and a trust and
(25:45):
then you know, the poor plumber or the or placemakers
or whatever say, should you go us, Oh no, you
can't touch that. It's all on a trust which you
can't touch our house. I mean that that's much. Really,
it's really immoral.
Speaker 3 (26:00):
Well okay, let's but that's a lot of the objections
of people that are such and such. It's good it
all wrapped up in a trust.
Speaker 4 (26:06):
You know.
Speaker 3 (26:07):
Anyway, Janet, what's you.
Speaker 4 (26:09):
And I can understand that perspective. But there's also the
other perspective, Brandon, and that is this if everybody who
who goes into business with the with the best will
in the world, they're not out to, you know, to
rip anybody off. But but but issues happen which may
be no fault of their own. And I'll give you
a little example in a moment. If everybody starts off
(26:32):
like that, then you might get to find that New
Zealand no longer has an entrepreneurial spirit and nobody actually
wants to take the chance of going into business. I'm
going to give you an example of how how somebody
can end up in trouble and it's no fault off
their own.
Speaker 6 (26:47):
That's just that's just an example.
Speaker 4 (26:49):
But I mean, and and our land and our landscape
is littered with them, littered with them, these examples. So
here is an instant where you are in business and
you're going to do business with somebody else and they
can't pay you, and so you end up not being
able to pay you know, your creditors. So it's a
run on effect. Now that's not that's not your fault,
(27:11):
that somebody else has fault possibly, but that's a domino effect.
Speaker 3 (27:16):
It's also pointing out, Brendon, that we do have a
company structure in New Zealand where unless you have been
I mean increasingly they can be looked through. But we
still we have a company structure where you set up
your business, you have the right amount of capital backing
it up, and you go from there. And and the
trust is a step behind that in terms of protecting
the family home and stuff. I mean, it's a funny one.
I can understand what you say, though, I.
Speaker 4 (27:37):
Mean, I see two sides to the argument.
Speaker 6 (27:41):
Yeah, is that you know, you get these people that
are owned you know, you know, a million dollars and
they get ten cents from a dollar or something, you know,
because it's all the rest is in the trust and
they and they've still got there a couple of homes
in their beach place and there you know, luxury cars
and those people. Yeah, the people that are owned Bodley Squat.
Speaker 5 (28:05):
Really.
Speaker 3 (28:05):
Yeah, It's it's constantly a trick, key ethical issue, and
I think you know, there are a lot of people
listening to I mean there It is a tricky issue
because you do get people who you know, that are
the creditors through no fauld of their own. They're the
ones who get left out of pocket.
Speaker 4 (28:18):
Whereas yeah, as I say, I can unders I can
understand both both sides of the coin in an issue
like that. But I can assure you the trust that
we set up and that we're involved in the people
behind those trusts are genuine, genuine people that are in
business and want to do well in business.
Speaker 3 (28:38):
I think the thing is is that often high profile
there are hope, high profile cases where you think, got
somebody's company's gone bying and they're still cruising around in
a Lamborghini and all their creditors have been unpaid and
stuff and we can all think of examples where we go, well,
that's just something's wrong there.
Speaker 4 (28:55):
Yes, yeah, and I do take do take the point.
Speaker 3 (28:59):
But it's probably worth pointing out that there is quite
a hope there's some high profile cases where people may
have been looking like they've been leaving high in the hog,
but actually the government's looking through their business dealings and
whether they've behaved in the right manner and they actually
are actually getting a certain come up. And it's without
mentioning names, but we can always imagine certain cases which
attract our attention in that respect. But you know what
(29:19):
we have to do next before we go to Jody.
Is we going to take a quick break? Oh eight
hundred eight ten eighty twenty three minutes to six, Yes,
News Talk. Se'd be with Tim Beverage. My guest is
Janet Zuccoa. She's managing director of New Zealand Family Trust
Services Limited, talking about trusts. Any questions you've gotten, As
(29:42):
I say, you got to get in early because we'll
run out of time. But let's go to Jody.
Speaker 5 (29:47):
Hello, Hello, Hello, you good.
Speaker 3 (29:50):
Thanks.
Speaker 7 (29:51):
I have a family, a trust in that my father's
house when he passed away was left in a living
trust for me to be able to live in and
to have financial benefit from an example, to rent to
the house, and then when I pass, it goes to
(30:11):
my three children, who are who I suppose are the owners.
So in effect, I'm maintaining a property for the benefit
benefit of my children, which is a great thing.
Speaker 4 (30:22):
You're a life benefit, I'm sure you aren't you, Jody.
You know you've got like a life interest in it.
Speaker 7 (30:27):
A life interest, that's right, And it does seem like
a burden at times. It feels like I'm maintaining this
property for the benefits Further down the track, one of
my children is old enough now, they've just graduated with
quite a prominent you know, a good sensible degree and
(30:52):
can earn enough money. I'd like to know whether I
can draw on the the assets the equity in this
house and be able to use that for who to
be able to buy another property, to be able to
set her up before I die, because I'm quite good
(31:14):
health at the moment, so I'm not planning on popping
the cross anytime soon. So i want to know how
good damn how do I benefit my children?
Speaker 4 (31:26):
Depend on the terms of the trusteed, So you'll need
you'll need somebody to read that trusteed and really help you,
help you through that to see what could actually be
done using the assets now to benefit the beneficiaries.
Speaker 3 (31:45):
Who set the trust up.
Speaker 7 (31:48):
My father set the trust up, and he did it
in this way, I think because my partner wasn't very
good with business. He was about to go bankrupt, and
I was really worried that I would be bullied and
pressured and.
Speaker 5 (32:02):
To be having put.
Speaker 7 (32:06):
Exactly And that was a very real and.
Speaker 4 (32:09):
That's another reason why why we have trust. We are
going to have a massive transfer of wealth from generations
in the next twenty odd years, and a lot of
people are worried. A lot of parents are worried that
when the wealth transfers to their children who are who
are adults, but we'll call them children who are who
are children, that should anything happen in the child's relationship,
(32:32):
that the inheritance goes sidewards, that it's you know, it's
fifty to fifty and you do that a couple of times,
and you know you end up with them.
Speaker 3 (32:40):
About fifteen percent consent. Yeah, Actually, there'll be a lot
of eccet your your kids. They are actually beneficial beneficiaries.
You are the life beneficiary sort of whose interest precedes them.
Speaker 4 (32:56):
Yeah. Yeah, so I think what JODI's saying is she
gets the use of the assets, but they're really her
held in preservation ultimately for the final beneficiaries, which which
from this conversation appeared to be the three children.
Speaker 3 (33:09):
Because sometimes an example of that would be, for instance,
you might be the life beneficiary of a property, so
you basically the family home goes to Jody and her
children get to benefit later on. Can that create problems
with Jodie's like, well, that's very nice, but I'd like
to sell this and get a different house.
Speaker 4 (33:28):
Well, it can, but again the terms of the trusteed
may well be wide enough to permit.
Speaker 7 (33:34):
It, okay, And there are allowances for when I become
a little old lady if this property isn't suitable, one
can be secure. But of course, to financially help the
children into their own homes, yes, before say they're in
their late forties.
Speaker 8 (33:52):
Yeah, that's the real question.
Speaker 4 (33:55):
That's a very good point. So a lot of parents
are you know, are doing that these days. In fact,
I've just written an article on that. It's going to
be on our website in the next three days. But
I've just written that article on how to help your
children and to enter a home, and it may well
be using a trust so that your pets, so that
the parents giving the money or providing providing the werewall
(34:17):
to as a deposit or even a large large portion
of the purchase price, can ensure that it is protected
in relationship times.
Speaker 3 (34:25):
Yeah, so it looks like you'll need to get a
bit of advice on the text of that trust there, Jodi.
But it might be doable.
Speaker 4 (34:31):
Maybe doable.
Speaker 3 (34:32):
Yeah, good on your Jody, really appreciate your call on that.
Let's go to Emma.
Speaker 8 (34:39):
Hello, Hi, Hi guys, Hey, this might be how long
is a piece of string cup question? Jenna. I'm just
wondering if you've got original settler pass trusted up about
nineteen props at nineteen years ago. Three trustees that have
been there ever since the original settler's dead, four beneficiaries.
(35:00):
One beneficiary has taken umbrage with the way the trust
has been run. How long? And you've got two cases
slugging it out. A lawyer friend of mine set these
people that make the money. Here are the lawyers it's
been slugged at? How long? How long years can you
expect it to go on? I know it's a bit
of a piece of strength, you know, but really within reason,
you know, like how long?
Speaker 9 (35:23):
It's not that quock be another.
Speaker 3 (35:25):
Way to phrase the question, how quickly could we hope
to have it sorted well?
Speaker 8 (35:29):
With the new laws that came out twenty nineteen. Surely
it's a lot clearer now, isn't it. I mean, it's
not that complex if you specialize in it. I don't
get so the legislation.
Speaker 4 (35:39):
Has indeed helped us. It has helped us, and in
that regard, it has strength and beneficiaries rights, and it's
how trustees, especially professional trustees, independent trustees, more accountable. And
it does provide mechanisms for example if, for instance, if
people can't agree, then there is always the result to
(36:01):
the courts. But I'd like to think that professional trustees
can sit down and have national conversations. And if it's
beneficiaries or odds with each other, then really trustees can
call meetings with beneficiaries and say well, this is what
we're tabling and this is the reason why.
Speaker 8 (36:17):
So it's not happening though you've got two cases, like
I say, slugging it out and.
Speaker 4 (36:21):
Other other trustees independent trustees where they also beneficiaries of.
Speaker 8 (36:25):
The trust independent one is not though, so.
Speaker 4 (36:29):
So one is a trustee beneficiary? Is that correct?
Speaker 7 (36:32):
Yes?
Speaker 8 (36:32):
Yes, I'm just thinking how long, you know, really and
truly what's reasonable? I guess it could go for years,
couldn't it that regard.
Speaker 3 (36:40):
Astronomical The cost would be dreadful.
Speaker 4 (36:43):
I would think if it goes on and on like that.
But in that regard, if it's only one beneficiary, the
trustees have a duty to all of the beneficiaries. So
to a degree, the trustees have to step in and
try and bring some resolution to matters. I would have.
Speaker 8 (36:59):
Thought, mm, okay, yeah, I'm just.
Speaker 4 (37:06):
What what what can you call them eating with the trustees?
Speaker 8 (37:11):
M yes, yes, but yeah, just one is not, so
I can't say too much. But it's just interesting. I
just thought, you know, as an outsider, because I loved
law and looking at it, and it's just being involved
as well though. I was just thinking, how long can
this possibly go on? You know? Like I said, the
only people making all the money in the moment of
the two cases, yes.
Speaker 3 (37:29):
Involved, but like most animosity and divorces, I think the
only one is out of those.
Speaker 4 (37:38):
Matters can indeed be they can be helped either by
the courts or buy mediation. But in the very first instance,
I like to think that the trustees will sit down
because they and have a good chatter, because they they
do have duties to all beneficiaries, not just one beneficiary.
Speaker 8 (37:55):
Yeah, sorry, you benefit.
Speaker 3 (37:57):
What's your position here?
Speaker 8 (37:58):
I don't want to say too much. I really don't.
Not not on there, and if that can't work, then
the courts will sort it out pronto, hopefully, you know.
Speaker 3 (38:06):
I do have just why you're on the line. I
just asked this question. I mean, could M speak to
without you know, as since you talk to the cass
But is there a way of MS seeking advice from
somebod who's just you know, knows a few things about
trust to have a look at it? I mean, could
they talk, could she talk to you? Or you could?
Speaker 4 (38:24):
Indeed you've you know, our company, New Zealand Family Trust Services.
So in the first instance, I do take a lot
of course from people and then can help them a
little bit along their way.
Speaker 3 (38:34):
And you can manage that as well if you want to.
That's my suggestion, by the way, not not janets the MS.
So if you want to if you want to.
Speaker 4 (38:41):
Seek some advice right place, if you've got a great
lawyer who knows about trust, so I would have a
chat to them.
Speaker 8 (38:48):
Yeah, so you would say it's pretty specialized. Feel thank
you very much. And guys, okay, thank you appreciate it.
Speaker 3 (38:53):
These just as every time we get you on I
sort of think, God, this is actually quite fascinating this stuff.
We could talk for quite a long time, but unfortunately
we don't have much time, but we'll come back. We'll
see if we can squeeze on a call with Ryan
before we wrap things up. It is very quick call.
It is ten and a half minutes to six news talks.
He'd be it's time to squeeze it. One more call
(39:26):
with Janet's ACA from New Zealand Family Trust Services. By
the way, if you do want to actually get some
advice on trust, you're welcome to get in touch with
New Zealand Family Trust Services and asked for Janet and
I'm sure she'd love to help you. But anyway, let's
see if we can squeeze in one more quick bit
of advice or help not we're not personalized advice, of course, Ryan, Ullo.
Speaker 9 (39:43):
Sam, how are good. Thanks, good. I'm just bringing So
I was recently contacted by a family friend who just
in conversation let me know that I was going to
be I am his trustee for two of his trusts.
And I don't really know what to say about that
or how I felt about that. But I suppose my
(40:06):
question is should I I want to find out from
him what the details of the trusts are in all
that sort of stuff, or.
Speaker 4 (40:15):
Can I just understand that again? So your your friend
said that you are a trustee of the trust or
did he say you were bene fishery of the trust?
Speaker 9 (40:26):
He said, I'll be the trust trustee.
Speaker 4 (40:28):
You're going to be the trustee or you are the
trustee now I am. Now, Well, if you were a
trustee now, you would have had to assigned documentation. Okay,
that's the first thing I had to now. Okay, So
you would have had to sign documentation. And then you
will be bound by the trust out twenty nineteen and
(40:49):
of course or the common law, and there will be
various things that you will need to be doing. A
quick example of that is that you will need to
know what consists of the trust fund and be dealing
with that appropriately. But I can't see how you could
be a trustee if you've never signed anything.
Speaker 3 (41:05):
Is this person your friend?
Speaker 4 (41:08):
Is it?
Speaker 3 (41:08):
Because are they saying that they've got you in their
will as someone who's going to be having some responsibility
or something, or is it about it literally a trust
they say they've set up now.
Speaker 9 (41:19):
So he's had some trust and he's had trusts, he's
had some falling out with some. Fairly, I guess, and
I guess I'm the closest thing is something at the moment.
And maybe I guess maybe I interpreted it wrong that
I'll go in to.
Speaker 3 (41:35):
Be one or you might need to seek seek some
clarity from it.
Speaker 4 (41:39):
But yes, so be very clear what exactly you are
now and what he wants you to do in the future.
But if you are a trustee, you do indeed have
duties now to attend to.
Speaker 9 (41:50):
Yeah, because I was wondering whether I needed to find
out what the details of it.
Speaker 3 (41:54):
And yeah, absolutely, yeah, Sorry, we can't add for more
help with theirs with it shorter time. I did want
to answer this quick text says Tim. We have a
trust as we have a business. We only have a
family home and the trust as it's our only asset.
It costs us approximately a thousand bucks a year to
run it. Should we keep it? Not specific financial advice,
but I would tend to think if you've gone to
(42:16):
the trouble of keeping your house and a trust, I
would tend to keep it.
Speaker 4 (42:19):
Miss And if you're in business, yes, so that is
your that's your insurance policy that I was talking about before.
That's the asset protection, providing that it's actually run quickly.
We for for our fees were six hundred and ninety
five a year, and we hold an annual trustee meeting
with that, so I guess that's a little bit cheaper.
It's pretty important to make sure that things are done
(42:40):
annually to ensure the trust retains its integrity and stands
up should anything happen in that business.
Speaker 3 (42:46):
I probably wouldn't hurt to get a little bit of
advice from someone who's maybe not one of the trustees. Now,
just get some advice from someone about about why you
might want to keep it. That's all we can do.
But time flies, Janet, doesn't that mean at the end
of it.
Speaker 4 (43:03):
Yeah, Married Christmas to you, Tim, and Merry Christmas to
all of our listeners. I hope you have a really
joyous and peaceful Christmas.
Speaker 3 (43:12):
Indeed, And if you want to New Zealand Family Trust Services,
that's Janet Zuka z U c CooA. And thanks for
my producer Lock. Good job Lock, and I'll catch I'll
catch it tomorrow morning at nine o'clock the Christmas Christmas
Conveyor Belt starts. We'll catch you tomorrow. Open that bag.
Speaker 1 (43:44):
For more from News Talk zed B. Listen live on
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