Estate planning is not just about giving your stuff away when you die. It’s about giving your stuff away when you die in the most efficient manner possible and providing the best protections allowable to your loved ones. This is the most simple asset protection available. Anybody that does not include some form of trust protection, for their loved ones, is missing the boat!
There is no simple way to create a trust for yourself that gives you asset protection. However, when you set up a trust up for a third party it can give them asset protection. That is, creditor protection or liability control or whatever you want to call it. This is estate planning 2.0 to use the current vernacular.
In the “old days” trusts were set up to be distributed to children at age 30 or 35 or some such randomly chosen age. Yes, 30 or 35 is far better than 18, for putting large amounts of wealth into the next generation’s hands. However, what about putting that next generation in control at 30 or 35 BUT leave it in a trust that can give that child security and protection not otherwise afforded them if they received it free of trust? That is asset protection.
A properly drafted trust will allow your child or other loved one to do the following:
- Have complete discretion on investments;
- Have complete discretion on distributions during their lifetime;
- Have complete discretion on where the money goes when they die.
That sounds a lot like if the assets were not in trust and didn’t have creditor protection!? That’s right! A properly drafted trust gives all the flexibility but with some protections around it.
The key is to work with an experienced estate planning attorney to get this done right!
Good luck with your family wealth planning!