Questions:
Are you worried about a beneficiary losing part of their inheritance because of the high divorce rate or the risk of lawsuits?
Are you worried about your children losing part or all of their inheritance to lawsuits, divorce, bankruptcy, or medical bills?
Do you have a child, grandchild, or another beneficiary who you’re worried might squander or waste their inheritance after your death?
Do you have a beneficiary who suffers from a substance abuse problem or gambling addiction, a mental illness, a history of making poor spending decisions, or unwise investments?
Do you have a beneficiary who always seems to be in debt?
If you have any of the above concerns, you’re not alone, and you should keep reading. But first, here’s a simple diagram showing what happens after death with and without Beneficiary Asset Protection.
- The beneficiary can have direct control of the assets as trustee of his or her own sub-trust, but the assets are protected from divorce, lawsuits, bankruptcy, and medical bills. The beneficiary can purchase assets in his or her name as trustee of the sub-trust. This can include primary homes, second homes, rental property, vacation property, land, vehicles, etc. — anything that has a title can be titled in the name of the sub-trust and protected inside the sub-trust.
- If you don’t trust the beneficiary to act as the trustee, then you can name a different trustee who can make direct payments to landlords, mortgage lenders, schools, doctors, hospitals, etc. Or the trustee could make regular payments to the beneficiary, similar to an allowance.