RNH Law Blog

Can I Avoid Creditors With A Trust?

Can I avoid creditors by placing all of my assets into a trust? Generally, the answer is no.

Once again, talking about the standard revocable living trust, that instrument in and of itself does not provide any protection from creditors. Potentially, an irrevocable trust could, but only in certain circumstances.

In general, if you have creditors, simply putting your assets and your items into a trust does not make it so that they cannot reach out and grab those if they get a judgment against you. The best course of action is obviously to pay off all your creditors if there are cases where that isn’t possible. In all honesty, maybe talking about a bankruptcy is something that’s more helpful than a living trust. The living trust simply doesn’t provide that kind of asset protection.

If you have any more questions about living trusts, trusts in general, or just need an estate plan set up, make sure to call me today. Thank you.