If you ever listen to talk radio on Saturday or Sunday mornings, then you might hear a financial expert taking calls and giving advice on investing and asset protection. While this expert is obviously trying to attract some new, wealthy clients, the general principles he or she extols should work whether one is wealthy or middle class. If you have made an effort to really save and invest wisely, then, likely, you have built up some assets for your retirement and eventually for your family. Along the way, you likely want to protect your assets. Right?
Asset protection requires careful planning. Threats to your assets can come from a wide variety of potential predators, including future creditors and unnecessary taxes. For such planning to be effective, you will need the help of an experienced estate planning attorney sooner rather than later.
Note: Asset protection is only effective against future, not present creditors!
There are several strategies you can implement to protect your assets before a claim or liability happens. While this is not an exhaustive treatment of a rather complex topic, the following asset protection ideas will get you thinking.
Insurance. Look into a personal umbrella liability policy that will cover you in most any situation that might happen. Umbrella coverage provides extra liability insurance to cover injuries, damage to property, lawsuits, and other personal liability situations. Make sure that you purchase enough, at least equal to your net worth. A call to the insurance agent who handles your homeowner's insurance policy should be the first step.
Jointly-held accounts. Take a look at any jointly-held accounts you might have. Remember, the money you deposit into a joint account with your kids, senior parents, or business partner is at risk. How? Should a joint owner later become divorced, have a tax problem, or be on the losing end of a lawsuit, then your money in the joint account will be at risk. Accordingly, if you truly must have a joint account (e.g., so your responsible adult child will have access to funds for your funeral), then try to maintain the lowest account balance possible. By the way, the same advice applies to any type of asset you may own, specifically including your home.
Partnerships. As with jointly-held accounts, when you operate a business venture as a partnership (whether formal or informal), you are responsible for the actions of your partner. Alternatively, consider creating a Limited Liability Company (LLC) or corporation to give you a greater degree of legal protection from your business activities.
Small businesses. Create a business entity. Period. If you own a small business, such as a sole proprietorship, then all of your personal assets are at risk if you are involved in a lawsuit. Consider transitioning your business activities into a more formal entity, such as an LLC or a corporation to limit the business risks to the business itself. This move can shield your personal assets.
Aside from getting the details on an umbrella policy, contact Jarvis Law Office, LLC at your earliest opportunity. Remember: Asset protection does not work after the fact.
Veterans and their families are often surprised to learn that they may be eligible for up to $2,127/month to help pay for the cost of Alzheimer’s care. My “nuts and bolts” guide reveals the details behind this little-known program.
904 N. Columbus Street
Lancaster, OH 43130
270 Bradenton Avenue, Suite 120
Dublin, OH 43017
219 E. Main Street
St. Clairsville, OH 43950
Jarvis Law Office provides services for nearly the entire span of the Elder Care and Estate Planning spectrum in order to help you retain more of your assets and more of your dignity as you age. Jarvis Law Office, LLC serves clients throughout Lancaster, Columbus, Dublin, St. Clairsville and the Surrounding Areas.
Copyright © IMS. All rights reserved. You may reproduce materials available at this site for your own personal use and for non-commercial distribution. All copies must include this copyright statement. Some artwork provided under license agreement.