WARNING: Many people believe once they set up a Revocable Living Trust and transfer assets into the Trust, those assets are protected from lawsuits. This is absolutely not true.
While Trusts commonly provide asset protection for beneficiaries, few Trusts protect assets owned by the person who created the Trust.
No Immediate Asset Protection? Why Should You Create a Revocable Living Trust?
Fully funded Revocable Trusts are dynamite tools. Here’s why:
1. You can protect assets passing to your spouse and children. Yes, you can provide protections for assets you leave to your loved ones that they can’t provide for themselves.
2. Your Trust includes an incapacity plan, avoiding court interference, maintaining your control, and saving your loved ones time, money, and stress.
3. Your Trust allows your assets to avoid probate, minimizing the time, stress, and cost of settling your final affairs.
4. By avoiding the public probate court process, your Trust keeps all details about who is getting what a private family matter.
What Can You Do to Protect Your Assets?
Comprehensive estate planning has a solid foundation of insurance, including homeowners/renters, umbrella, auto, business, life insurances, disability, and the like. Business entities such as corporations and limited liability companies are commonly used for asset protection. Utah law authorizes the used of a Domestic Asset Protection Trusts to protect your own assets in limited circumstances as long as the trust meets certain requirements.
Your Revocable Living Trust creates a powerful value and can be drafted to provide asset protection for your loved ones. To protect yourself and your own assets during your lifetime, use insurance, business entities and, perhaps, a Utah Domestic Asset Protection Trust.