What is Asset Protection?
What Are Asset Protection Strategies?
Asset protection is a set of legal and financial strategies and techniques that are designed to protect a person’s assets from creditor claims. These strategies can protect assets for individuals and their heirs. In some cases, asset protection can prevent seizure or garnishment from creditor claims and financial liabilities, including lawsuits.
Asset protection planning is a crucial strategy for estate planning. Asset protection can safeguard assets against potential claims from creditors and other financial liabilities. This can include government entities in some cases. With proper asset protection strategies you can shield assets from creditors and protect them for your family and heirs.
Strategies to Protect Your Personal Assets
Asset protection strategies can be implemented to protect a wide range of assets, including:
Real estate
Investments
Personal property
Bank accounts
Irrevocable trusts
The creation of an irrevocable trust can help to shield assets from creditors and lawsuits. When an irrevocable trust is created, any assets that are placed into the trust become legally the property of the the trust. Not only are these assets protected from creditors and lawsuits during your lifetime, they will pass directly to your designated heirs without having to pass through your estate, which is subject to creditor claims. When assets are placed within an irrevocable trust, the settlor relinquishes legal ownership power to the trust which is overseen by the trustee.
Asset protection trusts
An asset protection trust (APT) is a trust designed specifically to protect assets from creditors and lawsuits. These specialized trusts can be domestic or offshore, which are set up in foreign jurisdictions. Domestic asset protection trusts are only permitted in 17 states, including Alaska, Delaware, Nevada, and South Dakota,/// among others. Offshore asset protection trusts are also known as foreign asset protection trusts. Offshore trusts may be able to offer an additional layer of privacy and protection because they are held outside the U.S.
Insurance policies
Insurance policies are not subject to creditor claims. After you pass, the funds in your policy will transfer directly to your designated beneficiaries, and bypass your estate. You just need to make sure that you name designated beneficiaries or the policy could revert to your estate and be subject to creditors.
Retirement accounts
In general most retirement accounts are protected by federal law from creditors or lawsuits. This included Traditional and Roth IRAs, 401k accounts, and other employer-sponsored retirement plans. It is recommended to name beneficiaries or else they can be subject to creditor claims after you pass.
Asset and property transfer
In some cases, transferring your personal assets to another individual could protect your assets from creditor claims. But this could vary by state and in some cases the transfer could be deemed as fraudulent . This can often depend on when the transfer is made. Additionally, transferring property to family members can safeguard it, but such arrangements could also lead to disputes, especially during personal crises like divorce or estate claims.
Choosing an Asset Protection Attorney
An asset protection attorney can provide essential assistance for developing a plan tailored to your unique situation and needs. An experienced asset protection attorney can help you choose the most effective asset protection strategies for you and your family's needs.
Navigating the intricate state laws and regulations involving asset protection can be a challenge. Asset protection attorneys have the expertise to guide you through the complex laws and regulations to ensure that your assets are protected from creditors, lawsuits, and other potential risks. By working with an experienced asset protection attorney, you can achieve peace of mind and financial security, knowing that your wealth is protected.
Jelks Law: Estate Planning and Asset Protection Specialists
Don’t wait until it’s too late. Consult with our experienced asset protection attorneys today. We can work with you to develop a comprehensive asset protection plan that will secure your assets for the future.
Jelks Law can help you with planning techniques for asset protection as a part of your overall estate plan. This can give you the peace of mind knowing that your assets are protected for you, your family, and any chosen heirs.