As I stated yesterday some advanced estate planning techniques are over-used in that they are overly complex for a lot of people.  In addition they cause recurring costs.

There are two advanced estate planning tools that are under-utilized in my opinion.  The two are: 1) The Qualified Personal Residence Trust and 2) The Irrevocable Life Insurance Trust.

I have blogged about both of these before and would love to provide YOU more information but in short the two devices work as follows.

QUALIFIED PERSONAL RESIDENCE TRUST (QPRT) – An irrevocable trust that holds your house. It provides estate tax savings and maybe more importantly it provides creditor protection. It’s simple to set up and not that costly. There are no on-going costs.

IRREVOCABLE LIFE INSURANCE TRUST (ILIT) – An irrevocable trust that holds a life insurance policy for the benefit of your spouse and children (typically).  There can be huge tax benefits but even more importantly you can create incredible creditor protection for your loved ones.

Of course you should use a qualified California estate planning lawyer to set up your QPRT or ILIT.