At Unruh Turner Burke and Frees, the Trust Estates and Wealth Preservation section has developed a number of valuable resources for our Pennsylvania clients to both understand and to manage their Estates and to create asset protection strategies that work.
Asset protection is important for both you and your family. But, the strategies used by Pennsylvania residents to protect themselves are different from those they use to protect their spouses, children and heirs.
In short, asset protection for you is different than asset protection for your spouse or beneficiaries after you die. This brief artcile will look at both types of plans
Asset Protection for You as a Resident of Pennsylvania:
The key to protecting your assets is to have a comprehensive financial plan. A comprehensive financial plan should including calculating your net worth and assessing your retirement goals. This financial plan should be combined with an estate plan including such things as the use of irrevocable life insurance trusts, family limited liability companies, and charitable planning. Together your financial plan and estate plan will create your asset protection. In some cases, our Pennsylvania clients will use Qualified Personal Residence Trusts, GRATS, and asset protection trusts located in states such as Delaware and/or Nevada.
Asset Protection for Your Surviving Spouse:
Asset protection for your surviving spouse after your death can be created in the AB Trust system. The A and B Trusts are irrevocable and are funded with assets not owned by your surviving spouse. Also retirement plans that the surviving spouse rolls over into their own plan or that rolls into the A or B Trust will remain protected. The AB Trust system and your retirement plan protect your assets for your surviving spouse.
Asset Protection for Your Other Beneficiaries:
Have you ever worried about a spouse remarrying, or that a child might get divorced after inheriting money and lsoe all or a portion of that inheritance? Does one or more of your children or grandchildren have a job, business or profession that exposes them to lawsuits and to liability?
If so, your estate plan should be set up to protect your other beneficiaries from creditors, lawsuits, and divorces. Your estate plan might include establishing lifetime trusts for your other beneficiaries instead of leaving their inheritance outright. Like the AB Trust system, a lifetime trust that is set up for other beneficiaries is irrevocable and will be funded with assets not owned by the beneficiary. If a trust is not “self created” then it will offer protection to the beneficiary. You can also create trusts under your will which can offer your child or heirs broad use of the assets and the income from the trust without causing the trust to be reachable by the heirs’ creditors. These trusts are often referred to as beneficiary controlled trusts.
See the disclaimer on legal opinions. The article is general in nature.
David M Frees III
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