What does it really mean to safeguard your family’s legacy, and could an asset protection trust be the solution you’ve been searching for? Many families spend their lives saving carefully, only to see those savings threatened by unexpected events — nursing home costs, lawsuits, or even prolonged probate after death. That’s why I believe planning for these risks isn’t just wise — it’s often essential to peace of mind and financial well-being.
Protecting What Matters Most — Why Wills and Revocable Trusts Often Fall Short
It’s a common assumption that a will or revocable living trust is enough to protect your family and your legacy. But these tools, while vital pieces of an Estate Plan, do not shield your assets from major financial threats. Probate can still drain your estate with legal fees and delays, and revocable trusts offer little to no asset protection from creditors, predators, or long-term care costs.
That’s where asset protection trusts come in. Unlike a revocable living trust, an asset protection trust such as our Living Trust Plus® puts a legal barrier between your life savings and the challenges that can erode them, while still allowing you access to income (in some case) and investment control over your investments, sales control over your home, use of your home, and distribution control over all of your assets; you just can’t distribute assets to yourself because you are not a beneficiary of the trust. But you can distribute assets to a beneficiary, often a trusted child. The money then belongs to the child, who can do with it as desired.
What Exactly Is an Asset Protection Trust?
An asset protection trust is a specific kind of irrevocable trust designed to keep your home, investments, and other savings out of reach from lawsuits, long-term care expenses, and Medicaid estate recovery. Essentially, you “gift” your assets into the trust, but with carefully worded terms that allow you to retain certain controls, which helps avoid the costly tax problems associated with outright gifting.
In my practice, the Living Trust Plus® Medicaid Asset Protection Trust stands out as a proven solution. It’s designed to make you instantly eligible for benefits under the law when you need them, while ensuring that what you have worked so hard for ends up with your loved ones.
Common Questions About the Living Trust Plus Asset Protection Trusts
- Do I Lose Everything I Put in the Trust? No. You can still receive income (with the income retention version of the trust), and you will always retain the right to live in your home for life.
- Can I Decide How to Invest the Assets? Yes. You can serve as the trustee of the trust and decide how to invest the assets. Likewise, acting as trustee you can change how the assets are invested at any time.
- Can I Sell My Home After it Goes into the Trust? Yes. If you are the trustee, then you, acting as trustee can sell the house (and any other real estate in the trust) at any time. The money from the sale would of course go into a trust-owned financial account, not to you as an individual. You as trustee could then keep that trust-owned money invested however you want to invest it, or use it to purchase another trust-owned piece of real estate, which you could then live in.
- Are there tax risks? Not if structured by an experienced attorney. Our approach maintains your eligibility for valuable tax benefits, including the $250,000 / $500,000 capital gains exclusion for sale of the primary residence and the step-up in basis upon death for capital gains.
- How soon do I need to act? These trusts work best when set up at least five years before a long-term care need arises. The earlier you plan, the more options you have.
Who Should Consider an Asset Protection Trust?
If you have significant savings, a home, or family members you want to protect, an asset protection trust is worth strong consideration. This strategy is particularly critical if you’re concerned about:
- The rising costs of long-term care threatening your nest egg
- Ensuring your children and grandchildren actually receive your legacy
- Minimizing conflict among heirs
- Shielding your estate from lawsuits and creditors
In my experience, one of the greatest gifts you can give your family is a plan that works in real life — not just on paper.
Why Choosing the Right Attorney Makes the Difference
I’ve seen too many families forced to spend their life savings because they relied on “simple” Estate Planning. Getting asset protection right requires in-depth knowledge of local and federal laws, Medicaid rules, and tax consequences. As a recognized leader in elder law, my firm’s mission has always been to help clients preserve dignity, quality of life, and financial security — not only for themselves, but for generations to come.
Take Action — Don’t Leave Your Legacy to Chance
If you’re not sure whether your current estate plan offers true protection for your assets, now’s the time to review your options. You can learn more about exactly how asset protection trusts work and why proactive planning matters by exploring our in-depth resources. Start with the Living Trust Plus® Medicaid Asset Protection Trust overview or browse the articles on our Everything Elder Law blog.
Preserving your legacy isn’t just about dollars and cents — it’s about giving your family peace of mind and avoiding needless conflict and expense. Let’s take the steps together to make that a reality.
