WHAT IS ASSET PROTECTION?
Generally speaking, asset protection involves keeping your property and financial assets form being taken away in a lawsuit or claim. Through asset protection, you and your attorney can transform your nonexempt assets into exempt assets. For example, many retirement funds are protected from lawsuits. By transferring money into your retirement fund, you may be able to save it during a claim or lawsuit. Generally speaking, asset protection takes time; don’t wait until a claim has been filed against you. Talk to an attorney and establish your financial goals now so that you can have security in the future.
PROTECTION YOUR FUNDS THROUGH ESTATE PLANNING
Whether you realize it or not, estate planning isn’t just for the elderly or wealthy; estate planning is for everyone. If you own a car, have a bank account, financial assets or any personal possessions, you have an estate. Do you know what will happen to you restate when you die? Many people don’t. When you die, your estate will enter probate and your belongings and assets will be divided up according to state law. Probate and inheritance laws vary from state to state. If you plan your estate by establishing a will or living trust, you can take control of your assets to make sure that they end up in the right hands after your die.
There are many ways to protect you assets; estate planning is one of them. Through trusts and other financial documents, you may be able to use your estate plan to keep your money safe from creditors, claims and lawsuit. The most important thing to remember while protecting your assets is this: start early; late planning will probably backfire. If you wait until a creditor has filed a claim against you or you are facing a lawsuit, you may be accused of making a fraudulent transfer. For example, if you transfer a large sum of money into a retirement account right after someone filed a negligence lawsuit against you, the judge may reverse the transaction. Additionally, you may be fined for making a false transfer.