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Estates and Trusts

An estate is a person's net worth.

This includes assets, legal rights, interests, and entitlements to property of any kind. When developing an “estate plan”, an individual is essentially putting their entire financial existence in order.  It does not always mean that a person has a high net worth to have an estate.  Homes, cars, vacations property, pensions and bank accounts are common assets in a person's estate.  

The value of the estate is not the essential for protecting it.  Certainly there must be a clear cut asset or multiple assets to protect, but an asset with value is worth protecting.  Often the type of asset deternimes the protection and this is true of using a trust within an Estate Plan.  A major goal of an estate trust is to avoid double tax traps and probate courts and fees during the passing of an estate to the next generation. A trust can be a valuable tool in Asset Protection and in Estate Planning for the reduction of taxes.

How does a trust function with an estate? First, it is important to understand exactly why trusts exist. A trust is a legal relationship in which one person holds property for the benefit of another. The property can be money, real estate, stocks, bonds, collections, business interests, personal possessions and automobiles.  A trust is often designed to become a tool for Asset Protection and also for Wealth Preservation and can provide a means for mitigating taxation.

Trusts are used in Asset Protection to preserve estates for future generations and to protect at least some portion of a person’s wealth and property from creditor attack. The theory behind Asset Protection is to reduce ownership while maintaining all the benefits of a person’s assets. When money is transferred into a trust, from a creditor’s standpoint it can no longer be counted as part of the estate.

This strategy is not meant to hide money. Trustees report income and pay taxes. Trusts are used to preserve the integrity of an estate. Wealth can be protected from creditors and the benefit of the wealth is passed intact from one generation to the next.

When planning to protect an estate, there are many Asset Protection strategies available including Dynasty Trusts and Offshore Trusts. To create the best plan, consult with a team that consists of at least one trusted lawyer, account and Asset Protection Specialist.

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Generation Skipping Dynasty Trust $900
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Certified Wealth Preservation Planner Course, CWPP $1300
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