Once you begin to accumulate substantial wealth, you have to start worrying about protecting it from potential creditors. There are various tools to help do this, whether it be for protecting your business or your personal assets.
Potential creditors are everywhere: the taxman, accident victims, health care providers, credit card companies and business creditors.
A story on thespectrum.com says liability insurance is the first line of defense. This could include umbrella coverage on your homeowner’s policy or buying increased liability coverage for your business. The cost is reasonable compared to being hit by a lawsuit.
You can protect your residence with a declaration of homestead. This varies from state to state.
You may also want to divide your assets between you and your spouse. This may be a good strategy if you have a business but your wife works at a job.
And of course trusts are a good way to protect assets. Asset protection trusts are irrevocable, however. There are many types of asset protection trusts. You may want to talk to an estate planning attorney to learn about the different types.
If you have questions about estate planning, feel free to call us for a consultation at (626) 696-3145.
