What if you could just put your money in a vault and no one could get in the vault? Wouldn’t that be a great scenario? Of course, then you need consider what type of world we would live in if nobody had to pay for anything. This simple principle really strikes at the core of asset protection.
So what is it and how can you make it work for you in a legal ethical manner?
Asset Protection Planning is a strategic, preemptive preparation to prevent creditors from obtaining assets in the event of a civil judgment.
It does not mean that a person ignores their obligations to debt. It means that a person will control their obligations to debt.
Wealth Protection Plans should be all encompassing. Each asset may need to be treated differently, for example you may protect your personal residence differently than a rental income property.
You should also consider that liability can be passed or transferred just as proceeds can be passed and transferred.
Asset Protection Plans are all set up in the manner. They use legal techniques to put road blocks in front of the creditors. A main concept is to divide and conquer. Each asset class may need to be treated in a special way and titled in a special manner.
A skilled planner will understand the options available for specific circumstances.
An Asset Protection Plan should take all of your asset classes along with the family estate into consideration.
We are always willing to look a clients situation, it should be noted that asset protection strategies should be implemented when the financial seas are calm.
All asset fraudulently conveyed or transfered to avoid a judgment creditor are subject to clawback. In many instances, people will employ their own sort of asset protection planning. Trouble arises and the person starts gifting, giving, titling assets, moving money to family and friends. In this instance, all the transfers will most likely be clawed back and you may have just involved family members in your lawsuit.
While each and every plan is unique, as all of our lives are different, it is important to have a very good review of your situation. A clients age, marital status, children, extended family, location, can all have a large impact in structuring a proper plan.
Financial Risk Analysis
Investments Too Risky?
It’s tough to determine which investments to use if you don’t know your own risk tolerance.