Did you know you can use your estate plan to protect your assets? Estate planning provides many things and the benefits are endless. What many think traditional estate planning is, only covers a small portion of what an estate plan can do for you. Many think the main purpose of estate planning is the strategy you use to pass on your assets after your death. But estate planning is also so much more than that. While there is a difference between asset protection and estate planning, you can use your estate plan in different ways to protect your assets in a number of different scenarios.
Protecting Your Assets with a Trust-Based Estate Plan
A trust-based estate plan is a great way to protect your assets. There are two types of trusts that provide different protections.
A revocable living trust is set up to transfer your assets to the name of the trust, but you are still able to access and manage everything. This type of trust, like a will, still lists your instructions for the distribution of your assets and appoints who you want to handle the process. The main benefit of the trust is that having one avoids the probate process, unlike a will, because your assets are in the name of the trust. This may seem scary, but you are still in full control of everything and can make any changes you like to the trust during your lifetime.
An irrevocable trust is the opposite of a revocable trust in that changes cannot be made to the terms of the trust once it’s established and the assets you place in the irrevocable trust cannot be taken out as you are legally removing your rights of ownership. This type of trust is typically used for tax planning purposes and may help to shelter those who are vulnerable to lawsuits as the assets in that trust are not technically owned by them, leaving the assets safe from settlements and creditors.
Using a trust-based estate plan keeps your financial life private and also avoids the probate process. Going through probate opens up your financial life to the public, which can bring creditors, or even scammers, out of the woodwork and after your money.
There are so many other ways to protect your assets with your estate plan. Your estate plan should be tailored to your situation so don’t be afraid to ask questions and make sure you know what you need.
Not sure which type of trust you may need? Please contact us. We offer initial consultations at no cost so there’s nothing to lose if you want to see if we are the right fit to help you protect your family.
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Disclaimer: This article is intended to serve as a general summary of the issues outlined therein. While this article may include general guidance, it is not intended as, nor is a substitute for, qualified legal advice. Your review or receipt of this article by Lexern Law Offices, Ltd. (the “LLG”) or any of its attorneys does not create an attorney-client relationship between you and the LLG. The opinions expressed in this article are those of the authors of the article and does not reflect the opinion of the LLG.