There are all kinds of ways that you — or, rather, your estate — could end up being sued after your death. You could leave behind a major hospital bill, owe a big personal loan that never got paid back or even cause an accident just before you died.
Things like that put your financial plans for your estate — and the plans you may have had for your heirs — in serious jeopardy. For example, one man’s estate was recently ordered to pay $10 million to the bereaved family members of two Florida teenagers. All three people died in a wrong-way accident caused by the 99-year-old. The Michigan resident had already been listed as incompetent to drive and had somehow not only gotten on the wrong side of the divided highway but was also driving without his headlights on in the dark.
There are, however, ways to protect your assets from lawsuits after your death. In fact, an asset protection trust can even insulate your assets from creditors while you’re still alive.
An asset protection trust is considered a very powerful tool for protecting wealth from creditors and lawsuits. Generally, they’re formed in offshore accounts because the local courts lack jurisdiction over foreign trustees — although there are some domestic options that are also possible.
Another possible tool that could protect your estate from a lawsuit is an irrevocable trust. Once you transfer your assets into this kind of trust, however, you cannot change your mind or revise the terms of the trust because you legally no longer own the assets.
If you have a lot of assets to protect and pass down to your heirs, you have a lot to think about. Talk to an attorney about your concerns for your estate and find out more about the legal options available to you.