Insurance On The Frontlines
Insurance offers ideal frontline protection with regard to assets and it should not be overlooked. Most insurance policies require little work to obtain and maintain in exchange for very large benefit in the event of need. As such, there is little reason to forego the defense of your assets by not utilizing insurance in all applicable parts of your life. For business owners, settling for the least expensive plan available can be risky when a stroke of bad luck or lawsuits arise. Be sure to thoroughly review all plans so you are aware of what protection you truly get when things go awry.
Trusts As Asset Protection
Trusts are a great way to protect your valuable assets from creditors as they offer generous legal protection. There are various types of trusts which can all offer varying levels of defense. It is usually necessary for trusts to be both irrevocable, and formed before any creditor problems arise in order to keep money secure from the threat of those who may be seeking it. Be aware that setting up a trust improperly, particularly in cases of revocability, can eliminate any chance of legal defense you hoped to provide. Research and working together with your financial planner and an attorney can help you to avoid these potential mistakes.
Retirement Plans: Not All Are Created Equal
Utilizing a retirement plan as an asset protection vehicle can be an excellent defense against an uncertain future. Only certain types of retirement accounts offer protection and this may change depending on your state of residence, and potentially even bankruptcy status. Provided the plan is qualified, such as 401(k)s, and not suspected of fraud, you can enjoy complete protection from lawsuits whether you choose to declare bankruptcy or not thanks to the Employee Retirement Income Security Act. This is another area a lack of knowledge can leave your assets open to the wolves.
These are just a few of the asset protection options available to those who desire to limit the risk of loss. Whether you aim to protect your business, your personal funds, or the future you have set aside for your family, there are choices for you. Protecting your assets is a tricky business and the risk is far too large to get it wrong. At BD Financial Concepts we can help you discover the ideal asset protection strategy for your unique situation, contact us today.