Attorney
You have worked hard to accumulate your assets and property. However, you could lose a substantial portion of your savings and assets because of a lawsuit. Even if you were not at fault, a jury could decide you are liable. If so, the party seeking compensation could pursue claims against your assets.
After your death, creditors could file claims against your estate. The inheritance you intended to support your loved ones could be taken from them by creditors. You can protect your asses from creditors and lawsuits with the help of an experienced California estate planning attorney. There are several asset protection strategies you can use during your life and after your death.
Protecting Assets During Your Lifetime
The first step in protecting your assets is identifying potential threats and developing strategies to protect your property from those threats.
If you cannot pay your debts or you have a business that fails, your creditors may attack your personal assets. There are several ways you can protect your assets from creditors, including transferring assets to a trust. An attorney can help you choose the right trust for your financial situation and goals.
However, creditors are not the only parties that could threaten your assets. A divorce could threaten your property. California is a community property state. Therefore, all marital property is divided equally. The best way to protect your assets in case of a divorce is to enter a pre-nuptial agreement before marriage. A domestic asset protection trust might also be an option to protect assets during a divorce.
Lawsuits are another concern you must address. You could be sued for something that was not your fault. If you lose the lawsuit, the other party may enforce the judgment against your assets. However, by implementing an asset protection plan now, you can safeguard your property from future lawsuits.
Protecting Your Assets and Property After Death
Developing a comprehensive estate plan is the best way to ensure your assets pass to your heirs instead of being used to pay estate taxes and debts. Many people use trusts to protect assets from estate taxes and creditors. However, there could be other options you might consider.
You may want to use assets to fund a life insurance trust or put funds into an ERISA-qualified retirement account. Developing a gifting strategy can reduce or eliminate estate taxes and protect assets from creditors after your death. Placing your business in a family limited partnership or family LLC is another way to protect business assets during your lifetime and after your death.
Asset protection and estate planning work together to protect your property from creditors and lawsuits. Your strategies for asset protection during your lifetime should flow into your estate plan to protect assets after your death. Everything you do now has consequences for your heirs. Therefore, it is crucial to examine your asset protection strategies to determine how they impact your estate plan.
Contact Our California Estate Planning Attorney for a Free Consultation
Estate planning protects your assets and legacy for future generations. It is never too early to create an estate plan. Call our office to schedule a consultation with a California estate planning attorney.