The Walls Street Journal states that over 40% of affluent Americans have some form of asset protection. Effective asset protection plans are built around the use of one or more Trusts to hold assets. Not all Trusts protect assets. Before explaining the differences between types of Trusts I will clarify the parties titles in red letters.

A trust is created when a person, named atrustor, appoints another person, named a trustee, the right to hold the title of an asset for the benefit of a third party along with instructions on how the asset is to be distributed to the third party. The third party is named a beneficiary.

A Trust itself is a document that describes the asset being transferred, the person appointed as the trustee, and the instructions on how and the assets are to be distributed to the beneficiary.

The difference between most trusts and an asset protection trust is that an asset protection trust allows the person who contributes the assets (trustor) to the trust to also be a beneficiary, meaning the person who receives the trust assets. That means the person that owns the asset is giving the asset to someone else who will give it back to him at a later date. Everybody has heard the story about the guy who put his car in his friend’s name so his creditors can’t take it.
Everybody agrees that transferring an asset into someone else’s name to avoid paying a creditor is dishonest. It’s also illegal. The reason its illegal to put a car title in someones else’s name is that the reason is to cheat a creditor. If there is no creditor involved that the car owner can drive the car over a cliff, run the engine without oil, light the car on fire, or use it for target practice. All legal as long ano creditors are involved.

Please note that our laws allow us to put our money into a 401K or IRA account to help take care of ourselves in our retirement. Creditors cannot attach or go after this money. Our laws allow us to put money aside for a rainy day.

There are many legislators throughout the country who believe that people should be allowed to put money away for a rainy day, so long as they have provided for their creditors. Many successful people would like to take some chips off the table in the event that later in their life they may need that money. They may be high earners but have a medical setback and find they can’t maintain their income. Our government allows and even encourages us to set money aside for our use if we find ourselves in need. Our government goes so far in protecting retirement accounts that creditors are prevented from taking these funds.
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2700 E Sunset Road, Suite 13B, Las Vegas, Nevada 89120
Email: info@whitehallcompanyltd.com
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Contact Information
2700 E Sunset Road, Suite 13B, Las Vegas, Nevada 89120
Mon - Fri: 8.00 am - 7.00 pm
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