Asset Protection Trusts

Many people are confused and sometimes misled about what kind of Trust they should use. A revocable trust cannot protect your assets from creditors. It is not meant to do that. The primary purposes of a revocable living trust are to prevent probate and allow you to pass your estate to your beneficiaries one, two or more generations in the future. The irrevocable trust fulfills these purposes also, but in addition can protect your assets from creditors. However, you as creator of the trust have far less leeway in altering the trust or taking assets from the trust for your own immediate use. The Trustor (the one who creates the trust) cannot be the trustee of the trust. Also, he cannot generally remove the trustee without approval from a Court. The trust cannot be set up to give him set amounts of money at regular interval. These are just some of the restrictions of an irrevocable trust.