Your Will – What is a “Life Interest”?
|A life interest is a type of ownership interest in property (e.g. a house) which lasts for the life of a person who has been granted a “life interest”. This person is also known as the Life Tenant.
When the Life Tenant dies, ownership of the property then passes in accordance with the provisions of the Will to the beneficiary.
A life interest could arise in the case of a second marriage, where there are competing needs to provide for a spouse against the needs to preserve the assets for the benefit of the testator’s children. In this scenario, the spouse is allowed to reside in the house until he/she dies and the house then passes to the children in accordance with the terms of the Will.
It may also occur when the testator and his/her spouse have young children together and it is discussed that one of them re-partner after the death of the testator. In this situation, a life interest could be beneficial to secure the family home for the upbringing of the children with that asset passing to the testator’s children, once they become adults.
When considering a “Life Interest” provision in your Will please consider the following:
Sherry Kelly heads the Wills, Enduring Power of Attorney and Estate Administration practice of Colville Johnstone Lawyers, working alongside Nicole Khoury.
They both provide straight to the point, down to earth advice on Wills.