In our last post, we began speaking about the importance of nursing home planning. As we noted, failure to take time to do such planning can end with medical care depleting one's estate, forcing beneficiaries to sell property to cover costs, and spoiling one's other estate plans.
Asset protection planning is an important adjunct to estate planning, for the simple fact that you cannot pass on what you don't have. If your assets are wiped out because of a lawsuit or nursing home costs, you may have little left to give to your heirs.
Our Alpharetta readers may have heard of asset protection trusts, or self-settled trusts, in the context of estate planning. Self-settled trusts are those in which the grantor and the beneficiary are the same person. Such trusts receive the type of protection from creditors normally given to other types of trusts while allowing the grantor to maintain control of the assets.
In our previous post, we began looking at the importance of asset protection for estate planning and various options in this area. As we noted, trusts can be good tools for protecting one's assets from liabilities and creditors, as can qualified retirement plans.
When you go about establishing an estate plan, one of the things you will want to remember to work into your plan is some component of asset protection. The basic idea behind asset protection planning is to reduce your chances of losing your assets to a creditor. This is an important aspect of estate planning because the whole point of estate planning is to ensure that your wealth goes to persons and causes you care the most about.
Estate planning can often be a daunting task for individuals unsure of how or where to begin. Especially where family and/or financial situations are complex, estate planning can be tricky. And even though many have a basic understanding of their estate planning goals, some are not entirely sure of what their own priorities are in getting their estate in order.