Trusts are a Useful Tool for Investors
An asset protection attorney can provide you with valuable information and guidance, especially if you’re an individual concerned about asset protection and might consider using a trust or international trust.
Using a trust is one of the most effective asset protection strategies for preserving wealth. Trusts can be used as part of an investment strategy or an estate plan. Trusts can also help protect minors or special needs children after a parent or legal guardian passes on.
How a Trust Works
By establishing a trust, a separate legal entity is created. The settlor, the person making the trust, places property or assets in the trust. The settlor is no longer the legal owner of these assets and will appoint a trust attorney to manage the trust.
Benefits of Trusts
Some trusts can protect assets from the reach of creditors or former spouses. Trusts can also remove assets from the estate so that estate taxes are not imposed. If there are estate taxes, it can also provide liquid assets to pay these taxes. Another significant benefit of using a trust is that it is private and the details of it are not released to the public, whereas probate is a public process.
Reasons to Establish a Trust
There are several reasons to establish a trust. Many individuals use them as an estate planning tool. Having a trust is helpful because it helps individuals avoid the probate process. A person can place the majority of his or her assets in the trust, and, upon the person's death, these assets will transfer to the beneficiary that the settlor names.
Another benefit of having a trust in place is that a settlor can set the terms of the trust. This is helpful in providing for minor children or individuals who may not be financially responsible if they were to inherit a windfall. Another reason to establish a trust is to manage personal assets in the event that the settlor becomes incapacitated.
Types of Trusts
There are a variety of trusts that investors can choose. Some are called inter vivos trusts because they are for the living. There are also testamentary trusts that are established by a will after a person dies. Some trusts may be irrevocable, while others can be changed. Revocable trusts do not have the same tax shelter that irrevocable trusts do. Within these general categories are several other types of trusts, such as charitable trusts, spendthrift trusts and insurance trusts. An international trust can be established in another country other than the one in which the investor has citizenship.
Setting Up A Trust
Settlors have a variety of choices to make when meeting with trust attorneys. For example, they need to consider how they want the money in a trust invested, how assets should be divided among beneficiaries, whether to include adjustments for a cost of living change and other key considerations. The settlor can establish many rules to ensure that his or her wishes are carried out.
If you’re interested in setting up an international trust, contact Nagel Law. Nagel Law has 23 years of experience in asset protection strategies. Our trust attorneys can help you define your objectives and protect your assets.