When people create trusts, they generally do so for a number of different reasons. They might want to create a trust in the name of a relative for inheritance reasons, they might create a charitable trust so that their assets will be donated to a chosen charity after their death or they may want to protect their assets by keeping them out of the grasp of creditor claims.
It is possible to protect your assets through the creation of an asset protection trust. It is a relatively low-risk venture that is a legal way to stop creditors making claims against you and successfully grasping your assets.
How do asset protection trusts work?
When a people within the United States set up an asset protection trust, they usually opt to set up the trust in a country outside of the United States. This is to make sure that the assets in the trust are fully insulated and out of reach from creditors in the United States. However, it is still possible to set up an asset protection trust within the United States.
Asset protection trusts are usually created as irrevocable trusts for a set period of time. For example, they could be irrevocable for a set term of five years, and after this period upon termination, the assets will be returned to the trust maker.
If you are considering protecting your assets through the creation of an asset protection trust, it is a good idea to conduct thorough research into the different types of trusts so you can understand which will work best for you.