November 13, 2015

Although a revocable living trust is one of the most commonly recommended by an attorney when you are crafting your will or taking other estate planning steps, you need to carefully consider the own circumstances of your estate to determine whether it’s truly the best fit for you.

The primary purpose of a revocable living trust is to avoid the frustration and expense of probate after you pass away. While this is a worthy goal for your beneficiaries, you need to consider whether a revocable living trust goes far enough if one of your goals is to protect assets. Don’t let your loved ones find out too late that creditors can relatively easily access assets inside a revocable living trust.

Even though the trust is a legal entity, for legal purposes you are established as the owner of the trust assets allowing creditors’ potential access to these assets. If you set up a typical revocable living trust, you will name yourself as the trustee. This gives you complete control over the assets transferred into the trust so that you can take property in the trust, take it out, sell it or give it away without any restrictions. For legal and practical purposes, the property is still yours. Bear in mind though that having control over these assets also means that a creditor might be able to tap into it in the event of a lawsuit.

You may need to speak specifically with your asset protection planning attorney to shield assets from creditors. Planning for asset protection has become of increasing importance in recent years and finding a law firm that can help you do this is easier than ever. Make sure to ask questions about their experience in asset protection so that you feel confident about the role they are playing for you. Contact us at info@lawesq.net for more information.