When someone talks about preserving his assets with a trust entity, he is typically referring to a Statutory Trust. This kind of organization is different from a Common Law Trust in that it restricts its activities to those defined by legal statutes. In this section, we list the differences.
Living trusts do not protect assets as well as do Common Law trusts. While the trust creator is still alive, the assets of a living trust are visible and vulnerable to attorneys and state agencies. In contrast, Common Law trusts establish for the trust settler, while he or she lives, a situation that is nearly judgment-proof. This type of trust also has the distinct advantage of not only protecting assets, but of also providing privacy and reducing tax liabilities.
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