Asset protection trusts are the strongest tools for protecting your assets against creditors, lawsuits, and judgments. However, that’s not their only benefit. Asset protection trusts (APTs) can also be used for estate planning purposes, especially by individuals with a high net worth.
So, if you’re hoping to preserve your wealth for future generations, an APT could be exactly what you need! Read on to learn how to use asset protection trusts for estate planning:
- What Is an Asset Protection Trust?
- Asset Protection Trusts and Estate Planning
- How to Set Up an Asset Protection Trust

What Is an Asset Protection Trust?
Before you learn how to use an asset protection trust for estate planning, you need to understand some APT basics. Here are some key facts about these trusts:
- Asset protection trusts are always made up of at least three parties:
- Settlor/Grantor – The person who establishes and funds the trust
- Trustee – The person or company that manages the trust
- Beneficiary – The person(s) who receive distributions, interest, or other benefits from the trust
- APTs are self-settled spendthrift trusts. The person creating one serves as both the settlor and beneficiary.
- APTs can own a wide variety of property types, including bank accounts, liquid cash, personal possessions, real estate, and even automobiles.
- These trusts are run by trustees who legally hold the assets within the trust on the settlor’s behalf. If the settlor is ever sued, this ownership structure protects the assets from legal threats.
- Trustees have their powers and duties dictated by a trust agreement or trust deed. This document provides trustees with specific directions on how assets can be used and distributed to beneficiaries.
- Asset protection trusts can be established domestically or in an offshore jurisdiction. Offshore asset protection trusts (OAPTs), when established by a group of asset protection planners, offer the highest level of financial protection available against creditors and lawsuits.
Now that you know a little bit about how APTs work, let’s explore how they’re used in estate planning.

Asset Protection Trusts and Estate Planning
While they were originally created to protect assets, offshore asset protection trusts (OAPTs) have become the go-to estate planning tool for countless people. Some reasons to use offshore asset protection trusts for estate planning include:
- Flexibility and control: Many offshore jurisdictions allow for the inclusion of a custodian. Custodians are appointed by the grantor and oversee the trustee’s actions. They can even replace the trustee, if needed. Adding a custodian to the trust allows the grantor to maintain some influence over how the trust is administered, without retaining ownership or control that would undermine its protective features. This feature ensures that your wishes will continue to be honored even after your passing.
- No rule on perpetuities: Jurisdictions such as the Cook Islands have no rule on perpetuities, meaning that there are no limits on how long a trust can remain active. So long as the trust is maintained by a trustee and passed through the generations, your OAPT can continue to benefit future generations.
- Protection from creditors and lawsuits: Your assets need to remain safe if you wish to pass them to your children and grandchildren. Unfortunately, many of the most common estate planning tools, like living trusts, offer little protection from lawsuits. Using an offshore asset protection trust in your estate planning strategy virtually ensures that your assets will stay safe from lawsuits, creditors, and other threats.
Thanks to these benefits, offshore asset protection trusts have become a reliable tool for people looking to protect and pass along their wealth to future generations.

How to Establish an Asset Protection Trust
To set up an offshore asset protection trust for estate planning, it’s best to work with a professional. Trusts are complex financial tools, and any errors made while setting one up could open the door for creditors to take your assets.
Once you find a reputable professional, like those at Asset Protection Planners, the trust establishment process is fairly straightforward. Typically, we’ll follow these steps while setting up your trust:
- Initial consultation: Before we do anything, we meet with you to determine your goals for the trust. Based on this conversation, we’ll know where to establish the trust and which additional structures we need to fold into your trust.
- Jurisdiction selection: After speaking with you, we’ll identify the offshore jurisdictions that provide the right benefits for your particular goals. Generally, we choose to establish trusts in the Cook Islands, Belize or Nevis as they offer the highest level of asset protection.
- Trust structure design: Next, we’ll structure your trust in a way that aligns with your needs. This might include adding an LLC or custodian to the trust. We’ll also select an offshore trustee to manage your assets.
- Trust formation and legal documentation: Once we’ve designed the trust structure, we start setting it up. Our team will draft a trust agreement that outlines the duties and powers afforded to the trustee, names the trust, and establishes it as a legal entity.
- Asset transfer: Finally, we help you transfer your assets from their current location to the safety of your offshore trust. Most assets can be transferred without hassle, but some items, such as real estate, require custom strategies like equity stripping to gain protection from creditors.
After completing all these steps, your job is done, but we keep working. Trusts require regular maintenance to ensure they remain compliant with changing regulations. A member of our team will continually monitor your chosen jurisdiction for any legal changes and adjust your trust structure as needed.

Start Estate Planning with an Offshore Asset Protection Trust Today
To take full advantage of an offshore asset protection trust for estate planning, it’s best to establish a trust as soon as possible. The longer a trust remains active, the more likely a court is to view it as legitimate, which increases the level of protection it provides.
If you’re ready to protect and preserve your assets for future generations, now is a great time to get started. Fill out the form below to schedule your free consultation with Asset Protection Planners.
