The importance of a Memorandum of Wishes for a trust
Guiding your trustees so your trust is managed the way you intend
A memorandum of wishes is one of the most important – and most misunderstood – documents in a trust structure. It doesn’t replace the trust deed, and it isn’t legally binding, but it can make the difference between trustees guessing what you wanted and having clear guidance on your objectives.
Protect your family and your assets
We design trust-based and will-based asset protection plans around your family’s real goals and circumstances – not off-the-shelf templates.
A well-drafted memorandum of wishes is a key part of that plan.
Your Memorandum of Wishes
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A memorandum of wishes is a written document prepared by the settlor (the person or people who set up the trust).
It gives guidance and suggestions to the trustees about:
how you would like the trust to be managed; and
how you would like the trust assets to be used or distributed among beneficiaries.
It sits alongside the trust deed:
the trust deed sets out the legal rules and powers;
the memorandum of wishes sets out your personal intentions and preferences.
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Short answer: no – but it is still very important.
A trust deed is legally binding and sets the framework trustees must follow.
A memorandum of wishes is not legally binding, but trustees are expected to take it seriously and consider it carefully when making decisions.
In some cases, a Court may look at a memorandum of wishes to help understand:
what the objectives of the trust were; and
how the settlor intended the trustees to exercise their powers.
It is therefore a valuable tool in showing what you were trying to achieve when you set up the trust.
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A memorandum of wishes can be as simple or detailed as you need. Common contents include your wishes about:
how income and capital should be distributed between family members over time
particular guidance about children, grandchildren or other beneficiaries
what you would like trustees to do if a beneficiary is in financial difficulty, in a risky business, has a disability, or is otherwise vulnerable
how you would like trustees to approach relationship property issues
your thoughts on education, housing support or business assistance for family members
personal statements or messages about your values and priorities.
You can also attach a list of chattels (household items and personal belongings) recording who you would like to receive particular items.
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Although trustees must make their own decisions, a memorandum of wishes is an important tool to help ensure your intentions are taken into account when they administer the trust.
Without it, trustees may be left guessing what you would have wanted, which can lead to uncertainty or disagreements.
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A clear memorandum of wishes:
helps trustees understand how you expected them to use their powers
gives beneficiaries insight into why decisions are being made, which can reduce misunderstandings and conflict
makes it easier for new trustees to step into their role if you retire or die.
Why a memorandum of wishes is important
Creating and updating a Memorandum of Wishes
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When to create it
It is usually best to prepare a memorandum of wishes when the trust is first established, or as soon as possible afterwards, while your intentions are clear and your circumstances are up to date.
Keeping it up to date
Your wishes may change over time as:
children grow up or new family members arrive
relationships change
your assets or business interests change.
A memorandum of wishes can be amended or replaced. Updates should always be:
in writing, and
signed by the settlor (or, if there are two settlors, whatever your trust deed requires).
We generally recommend reviewing your memorandum of wishes whenever you review your trust and estate plan, or at least every few years.
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Your wishes may change over time as:
children grow up or new family members arrive
relationships change
your assets or business interests change.
A memorandum of wishes can be amended or replaced. Updates should always be:
in writing, and
signed by the settlor (or, if there are two settlors, in line with what your trust deed requires).
We generally recommend reviewing your memorandum of wishes whenever you review your trust and estate plan, or at least every few years.
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We can help you:
draft a new memorandum of wishes that reflects your trust deed, your wider estate plan and your real-life goals
review and update an existing memorandum of wishes where family or financial circumstances have changed
make sure your memorandum of wishes is consistent with your will, enduring powers of attorney and any other guidance documents.
Our aim is to help your trustees have the clearest possible picture of what you wanted, so your trust is managed in a way that reflects your intentions.
Getting started is simple
1. Book a free 15-minute introduction (for new clients)
In person or via Zoom – a chance to talk about your situation and how we can help.
This meeting is not for legal advice.
2. We outline your best options
We explain, in plain English, the pros and cons of different approaches – for example, a will-based plan versus a trust-based estate and asset protection plan.
3. You receive clear next steps and costs
You’ll know what we recommend, what it will cost, and the likely timeframe – so there are no surprises.
This meeting is to understand your situation and explain how we can help. It is not for legal advice.
How we work with you
When you ask us to help with a trust-based estate and asset protection plan, we will:
Understand your situation and goals
Your family, your relationships, your business or work situation, and what you are trying to protect.
Advise on whether a trust-based plan is suitable
We will be honest if a trust does not add enough benefit, or if changes to an existing trust are needed.
Design the right structure
We help you choose trustees, beneficiaries and key terms that fit your circumstances and future plans.
Prepare and implement the documents
We draft the trust deed, wills, EPAs and related documents, and guide you through signing and initial set-up (including transferring assets where appropriate).
Support you over time
Trusts and estate plans need to be reviewed. We are available to help trustees and families keep your plan up to date as life, laws and assets change.
Why you need an experienced trust and estate planning lawyer
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A trust-based estate and asset protection plan is one of the most significant legal structures you will put in place. Working with an experienced lawyer helps you:
avoid legal challenges and unintended tax or relationship property consequences
make sure your plan is legally sound and practical for your trustees to operate
keep your trust, wills and EPAs co-ordinated as your life changes
have peace of mind that your wishes are clear and your loved ones will be taken care of.
If forming a trust has been sitting in your “too-hard basket”, we can help you break it into manageable steps and finally get it done.
Disclaimer: This article should not be relied upon for legal advice. Always seek professional legal advice before making any decisions regarding your trust-based estate and asset protection plan.