Chris mentioned the strategy to Express.co.uk among some of the best ways to beat inheritance tax, in his opinion.
The expert recently discussed a pension mistake leaving pots insufficient for retirement.
He said: “The best way to get around inheritance is gifting within the seven-year time frame, that’s good.
“So, if you know you’ve got an estate of £5million and it’s unlikely that you’re going to spend that during your lifetime, put money into trusts or gifting for further generations.
“It definitely makes sense to do it earlier rather than later.”
What are Family Investment Companies?
A Family Investment Company (FIC) is a private company run by family members, with other family members owning the shares.
The investment decisions are taken by the directors, those running the FIC.
Parents often play the role of directors, with children or grandchildren as shareholders.
Chris said: “People are setting up Family Investment Companies for them and their children, putting assets in them, assigning the shares and the voting rights to those shares, typically to take into account for the future generations.
“It’s becoming more and more popular and more and more mainstream now. Whereas before a family office would have been quite a big thing, you’d need around £10 million to set it up and make it worthwhile.
“However, now it’s becoming popular for those with a lower net worth.”
An FIC works like a trust fund but is unlike a trust fund in that a trust is a separate legal entity in its own right
Chris said: “With a trust fund, typically the trust will have more control over how the assets are distributed and what happens with them, whereas in the Family Investment Company it will be up to whomever the shareholders and directors of that company are.”
Chris gave Express.co.uk readers advice for investing in retirement.
“A younger person I would be encouraging, if you’re investing your pension, for example, invest more in equities now because you’ve got a long way until you get to retirement,” he said.
For older Britons, who are looking at retirement, investments should be more cautious and lower risk.
“Somebody who’s closer to 60 I would say invest in more cautious assets as they’re going to be less volatile.”