Published on: 1st September 2025

Leaving Assets to a Vulnerable Person

What is a vulnerable person?

A vulnerable person, when referring to potential beneficiaries, is typically an individual who needs their inheritance to be dealt with by a third-party, rather than them receiving it directly. 

Some examples of a vulnerable person are;

• Someone with a disability.
  
  
• Someone with a drug addiction.
  
  
• Someone with an alcohol addiction.
  
  
• Someone with a gambling addiction.
  
  
• Someone receiving means-tested benefits.

Leaving assets to a vulnerable person in a Will requires careful planning to protect the individual’s welfare and preserve means-tested benefits, while also ensuring the assets are used appropriately.

Here’s a breakdown of the best practices;

Discretionary Trust / Vulnerable Person's Trust

• This is the most flexible and protective option and works as follows;
  
  
• You leave assets to a trust in your Will, not directly to the vulnerable person.
  
  
• Trustees (can be family) manage the assets and have discretion over how and when money is used.
  
  
• The vulnerable person can benefit, but has no legal entitlement; so the assets aren’t counted for means-tested benefits or care assessments.
  
  
• Why a discretionary trust is suitable;
  
  
• Maintains eligibility for means-tested benefits (e.g., Universal Credit, housing benefit, disability benefit).
  
  
• Allows trustees to manage money responsibly, especially if the beneficiary cannot manage finances.
  
  
• Protects the person from financial abuse or exploitation.
  
  

Appoint Suitable Trustees

• Choose trusted individuals (can be family) or a professional to act as trustees.
  
  
• The trustees will control how the trust is managed and how funds are distributed.
  
  
• You should create a “Letter of Wishes” to guide them on how you'd like the money used (e.g., housing, education, hobbies).

Common Pitfalls to Avoid

• Leaving assets directly to a vulnerable person – risks loss of benefits and financial exploitation.
  
  
• Relying on informal arrangements – not legally enforceable or protected.
  
  
• Appointing unsuitable trustees – could mismanage the fund or not act in the beneficiary's best interests.

Practical Steps to Take

• Speak to an estate planning practitioner, such as Casey & Associates, with a vast experience of dealing with Wills and trusts for vulnerable beneficiaries.
  
  
• Draft a Will with a Discretionary Trust / Vulnerable Person’s Trust.
  
  
• Create a “Letter of Wishes” explaining your intentions for the trust.
  
  
• Inform family members / executors so they understand the structure and don’t accidentally disrupt it (e.g. by gifting directly).

If you would like to speak with one of our Consultants to discuss any of the issues raised in this article or any other Estate Planning topic please telephone 01732 868190 or click here.

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To arrange an appointment please telephone 01732 868190 or click here.

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