With all the talk about estate planning in recent years, one topic is often neglected in the advertising: asset protection. It sometimes seems as though estate planning is sold as nothing more than a method to minimize estate tax liability. While it is true that your planning can accomplish that goal, it can also be an invaluable part of any effort to protect your assets. And given the fact that we live in one of the most litigious countries in the history of the world, that protection is more important than it’s ever been. The question most people want to know, though, is a simple one: can an attorney help to provide you that protection?
What is Asset Protection?
Asset protection consists of all the tools and strategies that we use to protect our wealth from the many threats that confront us every day. Millions of lawsuits are floating through our courtrooms – and many of them are frivolous suits brought to gain access to someone else’s wealth. Some end up being thrown out, but even the best judges cannot screen all of them. That means that you need to have protection in place to ensure that frivolous lawsuits cannot strip you of your hard-earned money.
Beyond lawsuits, there is also the issue of creditor claims against your business or someone in your immediate family. Many people simply don’t know what their rights are in these matters. A sound asset protection strategy can use things like trusts, business LLCs, and other strategies to ensure that those assets are outside the reach of any predatory creditors. Without this security, you could lose everything. With it, you can be as safe as any medieval lord sequestered in his castle.
Asset protection may start with the basics like insurance, but it should also adopt a broad-based focus that identifies areas where your wealth is most vulnerable, selects the best options to protect those assets, and implements a cohesive strategy that uses insurance, trusts, business structures, and other tools to safeguard your wealth against all the most common threats known to civilized man.
When Do You Need Asset Protection?
The better question, of course, is when wouldn’t you need this protection? Just consider the following examples of incidences in which asset protection can be critically important:
- When you own a business. The very organizing structure of your business can help to determine the safety of your assets. If you have a sole proprietorship or partnership, for example, your personal assets could be at risk if the company is sued. In that case, an LLC or corporate structure could provide the liability protection you need to protect your wealth.
- When you’re planning for Medicaid. Without sound asset protection, your wealth could be consumed by the high cost of nursing home care. With protection, you can keep many of your assets and still qualify for the government benefits you need to cover care costs.
- When you have irresponsible heirs, and want to ensure that they don’t squander their inheritances. A spendthrift provision can help to prevent their creditors from gaining access to the funds in the trust.
- When you have minor children or heirs with special needs. These protections create a wall of separation between the heirs and the trust, denying those beneficiaries direct access to any of the money.
- Any time you want to ensure that your wealth is not unexpectedly threatened by unforeseen events or people. Sadly, those threats are lurking everywhere, and you can never be too prepared.
How Does Asset Protection Impact your Estate Planning?
On the surface, asset protection might not seem like a major concern when it comes to estate planning. You only need to scratch just beneath that surface, however, to realize that it is critical for your planning. After all, your estate plan will be of little value if the assets you’re counting on for that plan somehow end up under attack by creditors, the government, or litigants. Once those assets are gone, every aspect of your comprehensive estate plan can quickly erode.
Your financial plan can be thrown into chaos. Your retirement plan can be destroyed completely, leaving you even further away from reaching your long-term retirement goals. And, of course, your overall inheritance planning effort can be dealt a death blow, as the money and resources you were counting on to fulfill that plan are stripped away from you. The fact is that you cannot have an effective estate plan without any assets in your estate. A crippling lawsuit or bankruptcy judgment could easily undo a lifetime of work.
Can an Attorney Help with this Protection?
The natural question many people ask is whether an attorney can help. That’s an easy question to answer: yes. However, not just any attorney will do. To maximize your protection and secure those assets, you need the assistance that only an experienced estate planning and asset protection lawyer can provide. Your attorney can help you to:
- Assess your business and personal interests to identify areas where you’re vulnerable to loss.
- Match those weaknesses to tools that are designed to protect your assets from those threats.
- Incorporate a variety of comprehensive estate planning strategies to ensure that you have protection that lasts on a long-term basis as well.
- Work with you to continually update your asset protection plan to ensure that it continues to meet your needs.
Who Can I Turn To?
When it comes to lawyers, you need someone you can rely on to protect your assets and interests like they were her very own. You can get that level of commitment at only one place: The Law Offices of Mary A. Miller, P.C. Our asset protection team will work with you to help you develop a plan that can safeguard your personal and business assets, to preserve all your other planning efforts and your life’s legacy. To discover how we can work with you to ensure that your most important asset protection needs are met, give us a call at (914) 939-6565 today or contact us online for more information.