The general perception about trusts is that you are divesting yourself of personal ownership of assets that you place into the trust. This understanding can lead to unintended consequences because it is not entirely true.
One of the most popular estate planning vehicles is the revocable living trust. With these trusts you facilitate the transfer of assets to the beneficiaries outside of the probate process.
People often take steps to avoid probate because of the fact that it can be costly, it is time-consuming, and it is a public proceeding.
Revocable living trusts are indeed very valuable as probate avoidance vehicles, but some people have objectives that a revocable living trust will not satisfy.
There are those who are looking for asset protection. This would commonly include people who are in professions that are inherently open to legal actions.
Resources that you place into a revocable living trust would not be protected from interested parties seeking to attach your personal assets. This is because you retain incidents of ownership when you create a revocable living trust.
Most grantors will act as the trustee and beneficiary of their revocable living trust while they are still alive. And, because the trust is in fact revocable, you can change the terms or even dissolve the trust. Since you still retain total control of the assets they are not protected.
However, there are various different and very effective asset protection vehicles that can be utilized. If you would like to become apprised of all of your options, don’t hesitate to pick up the phone to set up an appointment to speak with a highly qualified San Jose, CA area trust attorney.