‍The Ex-Files: Should we put our family home in a trust?

My partner and I have been together for 10 years but we have been having some problems recently. We have two children aged 4 and 7. I am a stay-at-home mother, having left my job permanently after my second child was born. My partner has a very successful IT company.

We have a lovely rural property and a beach house in our joint names. My partner has been to see his lawyer and wants to put the family home and the beach house in a trust.

Question: I have been reading a lot about changes to the trust laws. Is putting the family home and the beach house in a trust a good idea?

Answer: The first thing you need to do is get independent legal advice. Your interests may be different from that of your partner.

There are many reasons why families choose to transfer their homes to a trust and it is quite common in New Zealand for families to hold their assets in trust. The reasons may be to protect the property from creditors or business or professional risk, or to preserve assets for the next generation.

However, if you were to separate and had to divide the assets with your partner, you are better off having the property in your joint names than in a trust. This is because when property is owned in your personal name, it can fall under the category of relationship property and can be dealt with simply and clearly under our relationship property laws. When your property is in a trust, it cannot be classified as relationship property and this creates complications that may reduce your entitlements.

To continue reading and learn about how the Property (Relationships) Act 1976 relates to this kind of scenario, read the full NZ Herald article here.

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