Leaving a lump sum directly to a 10-year-old in your will sounds simple, but Singapore law does not actually let a minor manage that money themselves.

A testamentary trust is a trust created within a will that only comes into effect after the will-maker’s death, commonly used in Singapore to hold and manage an inheritance for minor children or other beneficiaries until a specified age or condition is met.

Not financial or legal advice. All figures for educational reference only. Data as at August 2026.

Key Takeaways

• A testamentary trust is written into the will itself and only takes effect after death — unlike a living trust, which is set up and funded during the settlor’s lifetime.
• It is most commonly used in Singapore to delay a child’s inheritance until a chosen age, such as 21 or 25, rather than an immediate lump sum at 18.
• The trust is managed by a trustee, who can be a family member, friend, or a professional trust company, and who is legally bound to act in the beneficiaries’ interest.
• Setting up a testamentary trust clause typically adds a few hundred to a few thousand Singapore dollars to standard will-drafting fees.
• Without a testamentary trust, an inheritance left to a minor is instead held by the Public Trustee until the child turns 21.

What Is a Testamentary Trust?

Under Singapore law, a minor cannot hold a large inheritance directly or manage significant assets in their own name. If a will simply leaves money to a young child with no other instructions, that money is held by the Public Trustee’s Office until the child reaches 21, paid out as a lump sum with limited flexibility over timing or conditions. A testamentary trust gives the will-maker far more control over this process.

Instead of relying on the default Public Trustee arrangement, the will-maker names a specific trustee and sets specific terms — for example, releasing a third of the inheritance at 21, a third at 25, and the remainder at 30, or allowing the trustee discretion to release funds earlier for education or medical needs. Because the trust is embedded in the will, it costs nothing extra to create until the will-maker dies, and it can be freely updated any time the will itself is updated, since it has no independent legal existence while the will-maker is alive.

How Does It Work in Singapore?

A testamentary trust clause is drafted as part of the will and only becomes operative once the Grant of Probate is obtained and the executor begins distributing the estate.

The same person can serve as both executor and trustee, though many parents prefer to name a different, younger family member or a professional trustee to ensure continuity if the executor themselves is elderly. Professional trustee companies typically charge an annual fee based on a percentage of assets under management, on top of the one-off legal drafting cost.

a Testamentary Trust Example

Mr and Mrs Lee, both in their 40s, have two children aged 6 and 9. Their wills each include a testamentary trust clause stating that if both parents die before the children turn 25, their combined estate of roughly S$1.2 million is to be held in trust, with the trustee (the children’s aunt) authorised to pay for school fees and reasonable living expenses along the way, releasing one half of each child’s share at 21 and the final half at 25. Without this clause, the full amount would instead have been held by the Public Trustee and paid out as a single lump sum the moment each child turned 21 — with no staggered release and no discretion for early education expenses.

Advantages of a Testamentary Trust

• Staggered, age-based payouts. Prevents a young adult from receiving a large lump sum all at once before they may be ready to manage it.
• Flexible, custom conditions. The trustee can be given discretion to release funds early for education, medical needs, or other specific purposes.
• No cost while the will-maker is alive. Unlike a living trust, there is no separate trust deed or transfer of assets needed until death actually occurs.
• Choice of trustee. Families can choose a trusted relative or a professional trust company, rather than defaulting to the Public Trustee.

Risks and Limitations

• Ongoing trustee fees (for professional trustees) reduce the amount ultimately available to beneficiaries.
• A poorly chosen individual trustee may mismanage funds or have conflicts of interest, especially over a long trust period.
• The trust only takes effect on death — it offers no protection if the will-maker becomes incapacitated while alive (an LPA is needed for that).
• Complex, multi-stage payout conditions can add legal drafting cost and require careful, unambiguous wording to avoid disputes later.
• If the named trustee predeceases the will-maker or is unable to serve, the will should nominate a backup trustee to avoid a gap.

Testamentary Trust vs Living Trust

Source: Ministry of Law, Office of the Public Guardian, Singapore (2026).

The Bottom Line

For Singapore parents of young children, a testamentary trust is one of the most practical estate planning tools available — it costs nothing extra to set up while alive, yet gives far more control over how and when an inheritance reaches a child than the Public Trustee’s default lump-sum-at-21 arrangement.

Frequently Asked Questions

Related Terms

• Estate Planning Singapore
• Legacy Planning Singapore
• Intestate Succession Act Singapore
• Insurance Nomination Facility Singapore