Protect Your Family From Wealth’s Dark Side With a Lifetime Asset Protection Trust

When you create your estate plan, you likely focus on positive outcomes. Providing security. Creating opportunity. Making life easier for the people you love. What most families never consider is how inherited wealth can sometimes lead to consequences they could never imagine.

The story of Clare Bronfman is an extreme but powerful example. As an heir to the Seagram’s fortune, she inherited extraordinary wealth at a relatively young age. Over time, that wealth and the access it provided became a gateway to devastating choices. Instead of protecting her future, her inheritance enabled manipulation, exploitation, and ultimately criminal behavior that led to prison.

While most families will never face circumstances this extreme, the underlying lesson applies to everyone. Leaving money outright to your children carries real risks, many of which cannot be predicted in advance.

When Inheritance Becomes a Liability

Bestowing wealth on your children or grandchildren can be a gift, but it can also expose them to risks you never intended. These risks are not limited to fraud or manipulation. In real life, inheritances are often lost due to divorce, lawsuits, creditor claims, medical emergencies, addiction, poor financial decisions, or simple inexperience.

Even responsible and well adjusted adults can be overwhelmed by sudden access to money. And once assets are distributed outright, there are very few ways to protect them from loss. This is why thoughtful estate planning is not just about who receives your assets. It is about how they receive them and whether those assets will still be there years or decades later.

Why Outright Distributions Often Fail

In Clare Bronfman’s case, much of her inheritance appears to have been available to her with little restriction or guidance. Over roughly fifteen years, she reportedly spent the majority of it funding an organization that ultimately caused irreparable harm to herself and others.

While her situation is extreme, the planning flaw is common. When beneficiaries receive assets outright, they gain full control immediately. That control includes the ability to spend, gift, invest, lose, or give away the inheritance in ways the original owner never would have chosen.

Once the money is gone, there is no undoing the damage.

How a Lifetime Asset Protection Trust Helps

One powerful planning tool designed to prevent these outcomes is a Lifetime Asset Protection Trust, often called a LAPT. This type of trust is created for the lifetime benefit of your child or grandchild and is specifically designed to protect inherited assets from both outside threats and personal missteps.

With a properly structured LAPT, your beneficiary can still benefit from and even help manage the trust assets. At the same time, the trust shields those assets from divorce, lawsuits, creditors, and other unforeseen life events that could otherwise wipe out their inheritance.

The trust exists for the beneficiary’s lifetime, meaning the protection does not disappear after a certain age or distribution milestone.

Education, Not Restriction

One of the most important benefits of a Lifetime Asset Protection Trust is that it allows you to educate rather than control. The trust can be designed so that your beneficiary becomes a co trustee at a certain age or stage of life. Over time, and with appropriate guidance, they may eventually become the sole trustee once they demonstrate readiness.

This structure helps your loved one learn how to manage wealth responsibly, while still maintaining safeguards during earlier and more vulnerable stages of life.

Because the trust is discretionary, the trustee you name has the authority to make thoughtful decisions about distributions. This protects your beneficiary not only from creditors and former spouses, but also from impulsive or harmful decisions made during stressful or emotionally charged times.

Providing Guidance That Lasts

Many families choose to include written, non binding guidance to trustees explaining how they would want distributions handled in common life scenarios. These may include purchasing a home, starting a business, funding education, traveling, or supporting family milestones.

Some clients also include guidance on investment philosophy and values. This ensures that future trustees understand not just the mechanics of the trust, but the intentions and priorities behind it.

Over time, as trustees change or beneficiaries step into trustee roles themselves, this guidance provides continuity and clarity that documents alone cannot accomplish.

Why Planning for the Unimaginable Matters

You may believe that something as devastating as the Bronfman story could never happen in your family. And while that may be true, no one can predict the pressures, relationships, or challenges your loved ones may face decades from now.

Even without extreme circumstances, inheritances are routinely lost to divorce, illness, lawsuits, and poor financial decisions. The question is not whether you trust your loved ones. The question is whether you want to protect them from risks no one can foresee.

How I Can Help

My role is to help you create a plan that protects both your wealth and the people you love. A Lifetime Asset Protection Trust may be an important part of that plan, but it is never implemented in isolation.

Together, we look at your family dynamics, your goals, and the potential risks your loved ones may face. From there, we design a comprehensive Life and Legacy Plan that provides protection, guidance, and support long after you are gone.

If you want to ensure your family’s inheritance remains a blessing rather than a burden, the best place to start is a Family Wealth Planning Session. This allows us to explore whether a Lifetime Asset Protection Trust is right for your situation and how it fits into your overall plan.

To begin, schedule your complimentary 15-minute Discovery Call today by clicking here. We look forward to guiding you.