Many people are concerned about creditors taking their assets from them. However, an individual can implement certain techniques to insulate property from various claims.
There are many types of asset protection, including state and federal exemption statutes; various types of insurance; business entities; gift-giving (including gifts to irrevocable trusts); and domestic self-settled spendthrift trusts. The various asset-protection tools and techniques provide varying levels of protection. In this area of the law, it is almost axiomatic that control and flexibility diminishes and costs increase as the level of creditor-protection increases. Thus, asset-protection planning starts with the process of finding the level of asset protection that provides an acceptable combination of affordability, flexibility, and effectiveness.