Asset Protection planning is often focused in two areas. The first is protection against unforeseen medical costs, particularly long term care. This area is really the heart of most elder law issues, and is discussed further on that page. The second area is protection against creditors, lawsuits, etc. These can be creditors of yours, and can also be creditors of your children/other beneficiaries.
Protect Your Assets with Proven Legal Tools
Unfortunately, our society continues to become more and more litigious. Most personal injury or malpractice attorneys will advise clients that no matter how strong a case may appear, you never know what will happen if you actually get in front of a jury. Because of the unknown, most lawsuits are settled prior to actual trial. Proper asset protection planning is designed to force early settlements, for lower dollar amounts in the unfortunate event of some action that leads to a lawsuit. Some of the tools that are frequently used are Irrevocable Trusts, Limited Liability Companies, and Family Limited Partnerships.
Additionally, it is not only the person who you were involved in an automobile accident that you should be concerned about. Asset protection can also be concerned with protecting assets in the event of a divorce. Particularly in second (or more) marriages, the effective use of prenuptial or post-nuptial agreements can be critical to not only protecting assets that were brought into the marriage, but also providing a smooth plan in the event of a divorce. Even if the assets are not terribly substantial, having a clear cut set of rules for the divorce can keep the spouses from despising one another and spending tens of thousands of extra dollars in attorney’s fees to settle the divorce.
Shield Your Assets from Creditors
One of the tradeoffs of asset protection planning often involves giving up some measure of control over assets. This is usually a necessary evil to provide protection. However, Missouri’s trust code provides a lot of flexibility to minimize that loss of control through irrevocable trusts. The key is to sit down with experienced professionals, and understand the various options that are available to accomplish your unique goals. This is also true when using corporate entities (LLCs or partnerships) to hold assets. Every asset protection plan is going to have some type of tradeoff in order to provide protection. By really understanding the risks that are present for your situation, and your individual goals- it is possible to make an effective asset protection plan that is customized for your family!
Asset Protection Vehicles Are Not a Substitute for Insurance
Very few individuals are emotionally prepared to deal with a lawsuit. But the reality is that accidents happen, divorces occur, and honest mistakes sometimes lead to people getting hurt. All of the asset protection planning in the world can help make these problems go away a little easier- but they can’t make them not occur. One of most important asset protection devices that should be utilized is proper amounts of liability insurance. Unfortunately, this is a very easy and relatively inexpensive step that is far too often overlooked. Almost weekly, our firm advises individuals about proper insurance (even when they weren’t looking for asset protection plans).
Contact the Weeks Group today to discuss your specific situation regarding asset protection planning, and how your goals can be incorporated into proper planning!