Given the complexities of financial rules and regulations in the US, many Americans are anxious about whether the assets that they hold are secure. Whether you want to keep your business assets safe from a potential attack in the future, or you want to ensure that your children, here are 4 asset protection tips that you need to know.
Set Your Business Up The Right Way
The legal structure that you use to set up your business will affect the level of protection that your assets have. For example, a sole proprietorship will provide you with very little protection. if asset protection is a priority for you then you should set up your business as either an S corporation or a limited liability company (LLC). Both of these will provide you with a much greater level of asset protection by default, as well as making it easier to institute other measures that will provide you with further protection.
Maintain Your Business Assets Separately From Your Personal Ones
It is always a good idea to maintain a degree of separation between your business and personal assets. Most business owners will already have a separate bank account for their business finances, but you can go even further than this in order to protect your assets. For example, it is a good idea to get into the habit of using your company name on all documents in place of your own, as well as titling any relevant property in your business’s name.
Set Up An Asset Protection Trust
Asset protection trusts are trust funds that are set up in order to hold assets and shield them from future attacks. In some cases, an asset protection trust is used to mitigate the financial impacts of certain events – such as taxation, divorce, or bankruptcy proceedings. Because of this, the rules and regulations surrounding asset protection trusts vary around the world. You should consult with a qualified attorney to find out whether trustee asset protection is suitable for your needs.
Put Assets In Your Spouse’s Name
If one spouse in a relationship has a significantly riskier job or leads a riskier lifestyle than their partner, it can often make sense to put some of your assets into the more secure person’s name. In most cases, creditors who are pursuing assets belonging to one spouse aren’t able to touch anything that is in the name of their partner. This makes this an effective strategy for keeping your assets safe and pre-empting any future problems that you might encounter.
Of course, you should always be careful about putting your assets into someone else’s name, even if you trust that person completely. Both you and your spouse need to be aware of exactly what the implications of putting assets in one another’s name are.
Taking steps now to protect your assets from potential problems in the future can ultimately save you a lot of money and headaches down the line. You don’t want to find yourself scrambling for solutions in a panic, so putting measures in place now is a good idea. If you are unsure how to best protect your assets, there are attorneys who specialize in asset protection that can help you.