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FAQs About Asset Protection

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Frequently Asked Questions

The team from Rutkowski Law Firm: Asset Protection & Estate Planning provides answers to some of our most popular questions.

1. Should I consider funding any motorized vehicles in my Trust?

a. Make a list of all personal (not business) vehicles to determine if the current $60,000 (2022) threshold for vehicles set by the Secretary of State is met. Include the type of vehicle, owner(s) and current total $ value. Types might include car, SUV, ORV, RV, trailer, etc. Do this same exercise in a separate list for your watercraft. That threshold is separate and set at $100,000 (2022). If the total $ value is over either threshold, then you might want to consider placing the asset into trust.

2. If married, does it matter which name the vehicle is in?

a. It does not necessarily matter whose name the vehicle title is in if the total $ value of all vehicles for that person are under the threshold mentioned above. If both spouses are listed on the title, the threshold only becomes a problem at the passing of the second spouse.

3. Does it matter what kind of Trust I have?

a. To avoid transfer issues and probate at the time of your death, it does not matter what kind of Trust that you have. However, if you are concerned about asset protection for your vehicles, you should speak to your attorney regarding your estate plan.

4. How do I fund the vehicles?

a. You will need to set up an appointment at your local Secretary of State branch. You should bring with you the current title to the vehicle and the Certificate of Trust for the trust that you want to retitle the vehicle to.

5. Do I need to notify my Auto Insurance agent of these funding changes?

a. Yes, just as we do for Homeowner’s policies during funding. Once the vehicle has been retitled, and new title is in hand, you will need to contact your auto insurance company to have the trust added as an additional insured.

6. Does Rutkowski Law Firm need to know, or can I do this myself?

a. RLF does not need to know about the retitling of your vehicle. However, it would be very beneficial to keep your new title either with your Estate Plan or where your Successor Trustee knows where to find it. They will need it should something happen to you.

Estate Planning Law Firm Serving Bloomfield Hills, Kalamazoo, Rochester, Sterling Heights & Macomb, MI

FAQs About Asset Protection

Below are some of the most frequently asked questions concerning asset protection:

What is asset protection?
Asset protection refers to legal strategies that protect properties from various risks, including judgment orders, civil liabilities, and excessive taxation. Because asset protection can vary for each person, asset protection attorneys create strategies tailored to individual needs, perceived risks, and the assets that require protection.
What are the benefits of asset protection?
With the right asset protection strategies, you can safeguard your assets from liabilities arising from creditors, business ventures, and long-term elderly costs. Additionally, you can protect certain assets in case of a divorce.

Asset protection is mainly done in anticipation of lawsuits. Once your assets are safe from judgment orders, creditors are more likely open to negotiating and settling instead of going after your assets.

Another benefit of asset protection is legacy preservation. Your heirs and beneficiaries can still enjoy your hard-earned properties, which is vital if you have minor children. If your estate plan includes asset protection strategies, you can allocate your assets and impose conditions to ensure your young children have enough resources to sustain themselves through college.
When do I need an asset protection plan?

If you have assets—especially real estate properties and investment funds—it’s time to consider an asset protection plan. Think of it as a contingency that may come in handy if someone ever sues you for civil damages and liabilities.

  • Entrepreneurship: If you’re opening a business, asset protection should also be one of your concerns. Owning a business makes you more vulnerable to risks and liabilities. For example, disputes may result in a costly judgment order if you deal with third-party suppliers and contractors. In that case, you could liquidate your personal assets to satisfy them.
  • Marriage: If you have marriage plans, consider asset protection. As you probably know, marriage is not just a union based on emotions. It will also significantly affect the status of your assets and properties.
    Generally, a marriage will merge the couple’s assets and liabilities. While there is nothing wrong with such an arrangement, problems can arise in the event of a divorce. Without an asset protection strategy, you risk losing half of your assets to your ex-spouse.
  • Retirement: Many people look forward to retirement, but this period in life presents a new set of challenges. Growing older means you’ll deal with more health concerns and the possibility of needing assisted living or long-term elderly care. These costly services could drain all your earnings. To preserve assets for your heirs, consider establishing asset protection strategies.

Establish your asset protection strategies before you must deal with judgment orders, a lawsuit, or a divorce.

How can I protect my assets?
Asset protection strategies differ based on each person’s needs and priorities. In general, it involves the establishment of particular types of trusts. Asset protection attorneys often recommend irrevocable trusts because properties transferred to them cannot be used to satisfy creditors. Michigan residents can set up a Domestic Asset Protection Trust (DAPT) to safeguard assets from third-party creditors.
What kind of assets should I protect?
You should protect valuable assets like real estate properties, bonds, and investment funds. Certain properties—including insurance policies, homestead, and retirement plans—are already protected by law and don't have to be included.
How can I get started?

Consulting an asset protection lawyer is the first step. They can assess your needs, goals, and properties that require protection. If you want to know more about irrevocable and other types of special trusts, call the Rutkowski Law Firm at (248) 970-1947 to schedule a free virtual consultation.

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Ask A Question,
Describe Your Situation,
Request A Consultation

Call (248) 792-9193 or fill out the short form below. We will usually respond within 1 business day but often do so the same day. Don’t hesitate, your questions are welcome.

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Consent*
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Your Information Is Safe With Us

We respect your privacy. The information you provide will be used to answer your questions or to schedule an appointment if requested.

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The information you obtain at this site is not, nor is it intended to be, legal advice. You should consult an attorney for advice regarding your individual situation. Contacting us does not create an attorney-client relationship.

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