How Do I Protect My Assets From Being Unjustly Taken
A common question we get is, “Hey David, how do we protect our assets from being unjustly taken, maybe from litigation or catastrophic loss?” And what I always start with is the timing for asset protection is actually before any litigation comes against you. That usually will trigger people into immediate action if they don’t have the proper planning in place.
We invite you to spend two-and-a-half minutes and learn more with this video featuring David A. Witter. David serves Financial Harvest Wealth Advisor’s approximately 150 clients, many of whom are local Floridians, while others are national or international. Providing fiduciary advisory and management, David and the team at Financial Harvest Wealth, follow the highest legal standards and best practices, providing attentive and personalized care for their clients.
How to Protect Assets Before Litigation May Occur
It’s always better to have it done before, as opposed to after the litigation. With protecting your assets, I’m going to speak to three general areas that we work with clients on planning.
#1: Get Proper Insurance
The first one is proper insurance. If you ask an estate planning attorney and an asset protection attorney, they’ll tell you it’s less expensive to pay insurance premiums for proper liability insurance to protect you on the front end, as opposed to paying attorneys to defend you on the back end. So it’s best to have that liability protection in place.
#2: Proper Titling of Assets
Second thing, I would say, or second area is titling of assets. So Florida, as an example, is very unique for married couples. They still allow something called joint tenancy by the entirety. Few States still have that, but in Florida, it is available. And for married couples, it’s very useful and helpful in terms of protecting assets from individual liability towards one of the spouses. So that’s the second category, is titling of assets and making sure they’re all appropriate.
#3: Trust Planning, Limited Liability
And last but not least is, we call them entities or structures. So think of trust, planning, or limited liability companies, a little bit more complexity there, but one of the places we see is coming more common, is people that maybe have children, adult children, and maybe grandchildren.
And they’re like, “Hey, I’m really worried about when I pass my assets down, how do I protect it from liability?” And that’s where trust can come in, and making sure that it fulfills your intentions as well as keeps away that catastrophic in litigation.
Asset Protection Summary
When you are thinking about “How do I protect my assets?” think in terms of multiple tactics to achieve your objectives.
The 5-Pronged Approach of Protecting Your Assets
- Assessing sources of litigation threats, likelihoods, and severity
- Proper titling and ownership of accounts and assets to make them harder to “penetrate”
- Utilizing accounts that have creditor protection specific in your state
- Building liability insurance hedges to transfer some, if not all, of the risk
- Irrevocable trusts with proper trustee powers and language.
Taking the steps now to protect your assets when and if the time comes that you would benefit from such protection will help insulate your wealth in a legal manner. Along the way, it will give you great peace of mind, knowing that you have the most appropriate and cost-effective strategies in place to protect your assets. Planned correctly, you will have protection not only in the near term, but you will also be protecting the wealth you will leave to your loved ones and heirs.
Financial Harvest Wealth Advisors’ asset protection strategies can help you protect your hard-earned assets from being unjustly taken through civil litigation or family divorce. Of course, the best time to implement asset protection, is not when you need it, but before you need it.