Estate planning lawyers in Plano are most often considered by folks who are wanting to put their end-of-life affairs in order. The lawyer helps them to draw up important documents such as powers of attorney and medical directives, as well as to develop a plan for how an individual’s property will be distributed upon his or her death. Wills, trusts, executors…these are all typical topics that a Plano estate planning lawyer will discuss with clients.
There is also a need to protect one’s assets during his or her lifetime. Not only is this important to the quality of life, but it also helps ensure that there is property that can be left behind! Asset protection is about choosing the best strategies to minimize the potential negative consequences of liability. That includes protection from claims made against an individual, as well as claims against your assets. The former would include things such as property damage or physical harm to another that was caused by you. The latter would have to do with damage caused by something you own, such as a business or property.
Commonly, if a claim is made against an individual or their property, just about everything that a person owns can be put at risk. For example, a judgment against you in a court of law can give creditors the ability to go after your assets in order to be compensated for damages. It can be an unpleasant eye-opening experience for a small business owner to discover that because someone was injured in their place of business, creditors may be able to take away personal assets that have nothing to do with the business itself. If someone slips and falls in your restaurant, as the owner, you could lose your home.
While estate planning focuses pretty heavily on wills and trusts to distribute assets after death, there are advantages to utilizing these tools during an individual’s lifetime, too. A trust can be especially helpful in keeping a person’s assets out of harm’s way, which is why working with a Plano estate planning lawyer is such an important part of a solid asset protection strategy.
Using a trust for asset protection doesn’t come without its limitations, though.
- In order to shield the assets from creditors, an estate planning lawyer will likely include a “spendthrift provision” in your documents. However, a spendthrift provision cannot be used with a revocable living trust.
- The trust must be for the benefit of the beneficiaries, rather than the person setting it up.
- Beneficiaries cannot be involved in the management of the trust and cannot make any changes to its terms.
There are other advantages and limitations to using a trust for asset protection during life, and a good Plano estate planning lawyer will be able to work with clients to determine whether it is a useful strategy based on each individual’s needs.