Asset protection is the birthright of every individual in the world. No doubt You might have heard many people making such statements. However, to understand what this statement truly conveys, you should first formulate a clear idea about what asset protection is and why you should exercise your right. This article attempts to throw light on such issues. You can also click here to know more details.
It may happen that you may dispute an unlawful credit card bill. Regardless, you might still be ordered to pay, with the refusal leading to creditor judgements. Alternatively, your spouse may not be happy with you for any number of reasons, and could demand a divorce. Without a prenuptial agreement, half your assets and future streams of income could be at risk. It’s also possible your business creditors may hound you to pay invoices or other liabilities. The list is endless. There are umpteen situations like these. You should know and understand that each of the above-mentioned parties has a right to seize and take control of your assets. Of course, they would require the intervention of the courts in this matter, but you may not always have the resources to fight them. You have a right to protect your assets from such overzealous creditors, divorce attorneys, etc.
Need for protecting your assets:
Every state in the US has its own law regarding debtor protection. Some states like Wyoming etc have some excellent debtor-friendly laws. You may never know when you would require asset protection, until it’s too late. Similar to insurance, you should get ahead of it and take care of these things before the credit event occurs. There are cases of fraud happening every day. You can become a victim of one quite easily. Without strategic asset protection in force, you may have to pay a huge penalty and lose your hard earned assets.
Financial risks are always present in any business activity. You may get into trouble any time. You owe an explanation to your family and loved ones as well. You have the responsibility of taking due care of them. For example, the government has an asset and income test which applies to spouses as well as the interned individual. You cannot let them down under any circumstances. Hence, it becomes imperative for you to safeguard your assets.
We shall explore some simple ways by which you can safeguard them. Click here to know more.
Simple means of protecting your assets:
You must work to ensure transfers are not fraudulent, as well. Any transfer not meeting the UFTA will be retrievable by creditors. The main objective of asset protections centers on this principle alone. We shall discuss a couple of simple means by which one can protect the assets.
You should know that there are certain kinds of “exempt assets.” No creditor will be able to touch these assets. Some of these exempt assets are primary residences, life insurance policies, retirement plans, and annuities. These assets are essential for the sustenance of the self and family. The court does not have any power to seize such assets, if you asset protection trusts are formed properly.
Another common strategy people employ is that they transfer the asset into the names of their loved ones. This can save the asset to a certain extent. There would be drawbacks to this facility as well. One is that the transferor loses all control and economic benefit arising out of the asset. The second drawback is that this transfer does not protect the asset in case the claim is against both the transferor and transferee.
There is a variation of this method where you can transfer the asset to a trust or a partnership etc. You can click here for further details regarding the same.Tags: Click here