How is an asset protection trust funded?

An asset protection trust is an estate planning tool which protects assets from creditors and other potential claims by placing them in a trust. In Virginia, the trust must be funded with assets such as cash, stocks, bonds, and other financial instruments. The trust should be established with a qualified attorney who is knowledgeable in asset protection and estate planning. Any asset placed in the trust must be owned by the grantor or given to the trust by the grantor before the trust can be considered funded. The grantor, or trustmaker, will also be the person responsible for managing the trust. It is important for the grantor to ensure that the trust agreement is drafted in accordance with Virginia law. The trust should also be funded with enough assets to cover all potential creditors and claimants. It is important to remember that entering into an asset protection trust should never be done as a means of avoiding legal responsibility. Rather, it is only to be used as a means of protecting a person’s assets from claims and/or creditors. In Virginia, grantors are only allowed to fund an asset protection trust with assets that have been legally obtained. It is important that you consult with a qualified attorney to work out the specifics of a trust, as each trust is unique to the individual’s needs.

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