Asset protection planning, once considered an exotic – perhaps fringe – area of the practice of law, is recognized increasingly as a fundamental part of estate planning:
“Asset protection in some respectshas been a part of estate planning for as long as an estate planning discipline has existed. After all, people create trusts for family members in most instances to preserve and protect property for the future use and benefit of the family members. From this perspective, asset protection is really just an integral part of the primary goal of the estate planner – to provide a structure to pass property, either during life or at death, to a client’s designated beneficiaries, while reducing transfer taxes and avoiding other costs and delays.
In today’s increasingly litigious environment, however, asset protection planning is becoming increasingly significant as a separate area of focus within the field of estate planning. The essence of asset protection planning is the use of advanced planning techniques to place assets beyond the reach of future potential creditors. In this way, the client can preserve the assets to pass to family members or other beneficiaries through traditional estate planning techniques.”
Fox & Huft, Asset Protection and Dynasty Trusts, 37 Real Prop. Prob. & Tr. J. 2987, 291 (Summer 2002).