In addition to other considerations, Texas individuals who are planning on getting married may need to take steps to protect personal property in case a divorce occurs. If no precautions are taken and the couple does ultimately divorce, both parties might face financial instability after the proceedings end. Traditionally, many couples have regarded the prenuptial agreement as a first option for protection. While the documents do work in some cases, they are not foolproof, and they can be thrown out in court depending on certain circumstances. For those with significant assets to protect, a prenuptial agreement may not be ideal.
Now, many people may be considering the use of a domestic asset protection trust when trying to secure premarital property. This method was originally used to help the wealthy protect assets from creditors, and one advantage of the DAPT is that it can be formed by an individual before he or she even meets a future marriage partner. This can allow couples to avoid an uncomfortable conversation about prenuptial agreements.
Just as a DPT trust guards assets from creditors, it also protects the property from being considered during the division process that occurs when a divorce takes place. The trust designates the owner as a discretionary beneficiary, so he or she has full usage while the assets retain complete protection.
For those looking for ways to guard assets from potential a potential disgruntled spouse, it is important to seek the advice of a lawyer with family law experience. The lawyer could review a client’s financial situation and might suggest different ways that he or she might secure individual property.
Source: Forbes, “How To Protect Yourself In A Divorce Using A Domestic Asset Protection Trust“, Robert Pagliarini , May 15, 2014