How to Protect Your Assets in an Estate Plan
Protect assets from bankruptcy, lawsuits or divorce.
Estate planning is a way to protect your assets and preserve as much as possible for your end of life care and your beneficiaries. Estate planning can help to avoid paying a hefty estate tax if possible, provide for the care and custody of any minor child you leave behind, and provide a way to manage your estate in the event you should become incapacitated.
Estate planning can also help protect your assets in case of bankruptcy, lawsuits or divorce. When you’ve spent your life building a nest egg, it would be devastating to see that taken away in one fell swoop. Although none of these things are fun to think about, we can never be sure what the future will hold, so it’s prudent to get an estate plan in place as soon as possible.
Bankruptcy
We often recommend asset protection trusts in the event of bankruptcy. You can put cash, property, investments, personal belongings and other assets into trust, which is then controlled by a person of your choosing. Since the belongings are no longer technically yours, creditors will be unable to reach them. One caveat: you must have established this trust well before any bankruptcy action occurs.
Divorce
Are there parts of your estate that you want to make absolutely sure are passed on to your children? Put them in a trust on your child’s behalf before there’s even a hint of trouble in paradise. This keeps your child’s inheritance safe from vengeful spouses as well as your creditors.
Discretionary trusts are good for this purpose. The child will still have access to the assets, but they don’t mandate how, when, why or the amount that’s distributed to your child.
Lawsuits
Putting assets into an irrevocable trust is, like in the case of bankruptcy, a way to keep your creditors from being able to touch your property. The assets are no longer yours, so they are not subject to being seized to pay debts.
This is different from a revocable living trust that many people use to avoid probate issues. With a revocable trust, the assets are yours and you can decide to whom, what and how much to distribute for the rest of your life. Since the assets are yours, however, creditors can and will often go after them.
We encourage everyone to meet with an estate planning attorney as soon as possible. Despite the size and value of your estate, everyone can benefit from protecting their hard-earned wealth. Your estate planning attorney will be able to advise you on your individual needs as well as draw upon their considerable experience to identify problems you might not have considered.
Baker Law Group
Baker Law Group, P.C. is happy to help you with your estate plan, from your major assets to the ones you may not have considered yet. Our team is skilled at handling all issues estate-related, including probate, asset protection and administrative services.
We offer a complimentary initial consultation. To schedule:
781-996-5656 Call
800-701-0352 Call Toll free
info@MBakerLaw.com Email
