While most individuals take steps to ensure that their wealth is passed on to their heirs after death, many neglect to protect those same assets while still alive. The simple truth is that nefarious actions, such as frivolous lawsuits, can threaten your hard earned wealth and put your legacy in jeopardy. That’s why asset protection planning is an important facet of comprehensive estate planning. And an effective financial protection plan might include the establishment of a domestic or foreign asset protection trust, among other protection structures.
It’s Part of a Comprehensive Estate Plan
An asset protection trust (APT) serves as a barrier between your wealth and those who endeavor to take it through financially ruinous lawsuits. In other words, the assets in your APT protected even in the event of a judgement made against you. Both domestic and foreign APTs offer good protection of your assets and are a solid response to an increasingly litigious population. But there are differences between them.
Domestic APTs are vulnerable to certain exceptions, including child support, alimony, and Federal bankruptcy. On the other hand, trusts in a foreign jurisdiction are not subject to the same exceptions, nor can U.S. judgements be enforced against them. For this reason, the overwhelming majority of lawsuits involving assets protected by an APT are settled for a small fraction of what the litigant initially asks for. The only way to ensure protection is to set up a trust prior to any lawsuit being filed or potentially litigious situation developing.
You Need a Skilled Attorney to Establish the Trust in Advance
Comprehensive estate planning should include both strategies to maximize your wealth and a platform to protect it. Highly skilled and experienced asset protection attorneys with the Jeffrey M. Verdon Law Group can oversee your financial health and ensure that your legacy remains intact.