If you are using a discretionary trust as part of your estate plan, the will tells the trustees what they can do. The letter of wishes, written by you, tells them what you would like them to do, and crucially, why.
A clear letter of wishes is one of the most useful things an estate plan can contain. It is also one of the most under-written. Many trusts hold letters that are out of date, generic, or silent on the questions trustees actually face.
Three questions the letter should answer
First, who do you want the trust to support, and over what timeframe. Naming the beneficiaries is not enough. Trustees need to understand whether you are providing for one generation, two, or three, and how you imagine the support changing as life moves.
Second, what kind of support do you want it to be. Education, property, business, hardship, or something else. The shape of the support is rarely obvious from the will alone, and trustees often need a steer on which uses you would have welcomed and which you would not.
Third, how much agency do you want the beneficiaries to have. Some clients want trustees to be conservative; others want beneficiaries to be involved in decisions from a meaningful age. The letter should say.
“Trustees should never have to guess at intent. Write the letter as if you were sitting in the room with them.”
Treat it as a living document
The letter is yours. It is not lodged with HMRC or attached to the will. It can be revised at any time. We recommend reviewing it every two to three years, and certainly after any significant change in family or wealth. A current letter is worth more than a clever one.