A living trust does not protect your assets from a lawsuit. Living trusts are revocable, meaning you remain in control of the assets and you are the legal owner until your death. Because you legally still own these assets, someone who wins a verdict against you can likely gain access to these assets. There are other options, specifically an irrevocable trust, to protect your assets from civil suits, however.
The team at Bratton Estate & Elder Care Attorneys can ensure you have a plan in place that meets your needs long before you need it. Contact us today to learn more about our New Jersey asset protection services.
Understanding How a Revocable Living Trust Works
Living trusts help your family avoid probate after your death. These trusts are a relatively common part of estate planning.
When you have a living trust, you remain the trustee as long as you are alive. This means you have full control of the assets you put in the trust. You can perform any of the following actions:
- Adding new assets
- Taking assets out of the trust
- Selling assets
- Giving assets away before your death
- Changing beneficiaries
- Spending the assets without permission
- Taking your assets out and undoing the trust entirely
For all legal purposes, the assets in a revocable trust remain yours even after you put them in the trust. This type of trust has few benefits aside from allowing your family quick access to the money after your death and eliminating the need for probate. Since you still own all the assets, they are fair game for debt collectors, plaintiffs, and others who have legal access to your accounts.
The Benefits of Placing Your Assets in an Irrevocable/Asset Protection Trust
An irrevocable trust differs from a revocable trust because it forces you to give up control of your assets. When you create an irrevocable trust, you name another person to act as a trustee, and they oversee what happens to the assets. You have no say over what this person does with your assets. If you decide you do not like the trust, there is no backing out — it is irrevocable. (It is possible to get out of an irrevocable trust with the use of a trust protector..)
You Have Control Over What You Put in the Trust
You have control over what you put into this type of trust, of course, so this is an effective way to protect your family home, inherited treasures, and other important assets from Medicaid, creditors, and legal action.
Other Parties Cannot Gain Access to Your Assets
Since your assets in an irrevocable trust are no longer under your control, it is difficult for creditors or those who file a civil suit against you to gain access. You can take other steps to build in additional protections. If there is already a lawsuit in the works, you may not be able to use this type of trust to protect your assets.
We Help with Asset Protection in New Jersey
At Bratton Estate & Elder Care Attorneys, we have an interdisciplinary team including not only estate planning attorneys but also social workers and a registered nurse who can help ensure we understand your family’s needs and create a plan that meets them. We provide a wide range of services, including helping you create an asset protection trust or other asset protection plans. We can protect your assets from creditors, lawsuits, or even Medicaid.
We can help you understand your options, including irrevocable trusts, to ensure your family has access to your home and other assets even if there is a verdict against you in the future. We can also explain other types of trusts that may play an essential role in your estate plan.
Meet with Our Team About Your Estate
The team from Bratton Estate & Elder Care Attorneys can help you understand your options for estate planning and asset protection. We treat every client like a member of our family. You will encounter only compassion and understanding, and every member of our team is dedicated to providing services that help give you peace of mind.
When we discuss your needs, our team can explain the applicable laws, and the services we offer that may meet those needs. We can help you build a comprehensive estate plan to protect your assets from lawsuits or creditors and secure your family’s financial future.
Call our New Jersey office today at 856-857-6007 to learn more or to get started.