A settlor has transferred £500,000 to trustees, with the instruction to hold it in trust for her son's lifetime and, upon his death, to donate it to a specific charity. The trustees are currently contemplating how best to invest the money.
What factors should they keep in mind while selecting the investments?
A settlor has transferred £500,000 to trustees, with the instruction to hold it in trust for her son's lifetime and, upon his death, to donate it to a specific charity. The trustees are currently contemplating how best to invest the money.
What factors should they keep in mind while selecting the investments?
They should invest so as to take into account the differing interests of the beneficiaries.
(C) The trustees have a responsibility to invest in a way that considers the different interests of the beneficiaries. The trustees are obligated to act impartially between the beneficiaries and must balance their interests. Therefore, they must take into account both the son's interest in the income and the interest of the charity in capital growth.
Option (A) and (B) are incorrect because the trustees must attempt to balance the competing interests of the beneficiaries.
Option (D) is incorrect because the trustees must consider the interests of the beneficiaries.
Option (E) is incorrect because the responsibility of the trustees is to focus on the financial interests of the beneficiaries, not the objectives of a charity.