Asset Protection Terms and Definitions

Casualty Insurance
Casualty Insurance coverage is primarily for the legal liability of an individual or organization that results from negligent acts and omissions causing bodily injury and/or property damage to a third party. However, the term is broad and includes such property insurance as aviation insurance, boiler and machinery insurance, glass insurance and crime insurance.

Marital Trusts
A marital trust is used to benefit the surviving spouse of the person who dies. There are many reasons for creating such a trust-- to provide asset protection for the surviving spouse, or to ensure that your children are the ultimate beneficiaries of your estate.

Foreign Bank Accounts
There is a thriving industry of offshore practitioners advising U.S. citizens to set up offshore bank accounts.

Asset Allocation
When you divide your money among various types of investments, such as stocks, bonds, and short-term investments (also known as "instruments"), you are allocating your assets. The way in which your money is divided is called your asset allocation.

Asset allocation
Diversification of your investments, usually between U.S. and international equities, fixed income, real estate, and commodities.

Durable power of attorney
A power of attorney that remains valid when the principal becomes incapacitated.

Secret Bank Accounts
Infamous numbered and bearer Swiss bank accounts. Switzerland has come under much scrutiny through scandals relating to money laundering and holding assets

Totten trust
A savings account that allows the depositor to open the account as trustee for someone else (no real trust is set up). Account owners may use the funds as they see fit during their lifetime, and then upon their death the account balance is paid to the named beneficiary.

Revocable Trust
In a living, or revocable trust, you name yourself as the grantor, the trustee, and the current beneficiary. You then transfer some or all of your assets to the trust. The terms of the trust require that the trust is to be used for your benefit during your life. After your death, the living trust continues for the benefit of your intended beneficiaries.

Trusts for Children
You can set up a trust for your children, too. The terms of the trust can specify which of the children's expenses to pay and under what circumstances.