Divisible Pot Trust

A divisible pot trust is a type of trust in which assets are divided into separate shares (or pots) for different beneficiaries. For legal and administrative purposes, each pot is treated as a separate trust, which allows flexibility and discretion in how the assets are distributed. 

In estate planning, divisible pot trusts are used to provide for the needs of multiple beneficiaries while allowing the trustee to maintain control over the assets and how they are distributed. For example, if beneficiaries have different financial needs or circumstances, a divisible pot trust can be used to allocate assets accordingly. 

The characteristics of a divisible pot trust include: 

• Multiple beneficiaries, each tied to a respective share of the trust assets. As with other types of trusts, these can include individuals or organizations like charities.
• Separate shares or pots that are allocated to each beneficiary according to the trustee’s wishes. 
• Independent management of shares, each of which have their own terms, conditions, and beneficiaries. This allows the trustee to customize and manage each share individually. 
• Flexibility in the management and distribution of the trust’s assets, as allocations can be adjusted based on circumstances.