Sudden Wealth Blog

Why You Need to Consider Asset Protection

December 31, 2022
7:44 pm

Asset protection can protect your hard-earned money. It can provide security for you and your family in the future. Find out why asset protection is vital and how it can help protect your finances from predator creditors.

Why Asset Protection Works.

You’ve seen the billboards. “No fee unless we win!” “We’ll take your case. You Pay Nothing.” Those are advertisements by contingent fee lawyers. Those are lawyers willing to sue people on a contingent fee basis.

Contingent fee lawyers are more willing to go after someone with assets. If they can look on the Internet and discover that you own lots of assets, you make for a juicy target.

Protecting your net worth works by moving things out of your name. The rule is this:

What you don’t own can’t be taken from you.

A good protection strategy will remove the economic incentive for a person to sue you. It will make you unattractive to potential predators creditors.

Understand the Basics of Asset Protection.

You’re most likely reading this blog because you want to avoid getting wiped out by a lawsuit. But other people may mean different things when they talk about “asset protection.” For instance, an insurance agent says they sell “asset protection.” But they are referring to liability insurance. Investment advisors talk about “asset protection.” But they mean avoiding taxes and bad investments.

This blog is about what are looking for — Protecting yourself from lawsuits and predator creditors. So here are the basics of protecting your net worth:

Protecting yourself with layers

Asset protection involves taking steps to protect your assets from anything that can them from you. The best approach is to do it in layers.

The first step is obviously to avoid risky behavior. Don’t slap your female employee’s behind. Be careful and attentive in what you do. That sort of thing.

Insurance is a next line of defense. Make sure you have good coverage for your situation. But insurance doesn’t cover everything. Plus it is has limits.

After insurance, there are other asset protection strategies to fill in the gaps. This is what a good asset protection lawyer can help you with. They will help transfer ownership outside of your name but in a way so you can still control it and later unwind it. This involves setting up trusts and forming company structures in certain ways.

Knowing these basics will help you make informed decisions about asset protection. It will also ensure that your assets are safeguarded in the event of any unforeseen circumstance.

Learn About Common Types of Liability and Risks.

Protecting your assets means understanding the liability you may face and the risks faced by those assets. Common types of liability include:

business liabilities,
negligence lawsuits,
income tax debt,
divorces,
suits involving creditors or collection agencies,
property disputes and more.
Taking proactive steps can help protect you from these potential risks and safeguard your finances over time.

Establish an Appropriate Strategy for Your Situation.

Developing a strategy for protecting your assets starts with analyzing your current situation. Determine where you are most at risk and what potential liabilities you may face in the future—both personally and professionally.

Then ask yourself specific questions about how to best protect those assets from those risks. For example, figure out what transfer techniques would work best and if there is anything you need to do immediately.

Every lawsuit protection plan should be tailored to fit your individual needs. It should take into account your particular industry and level of risk exposure.

Why Asset Protection Is Heavily Marketed.

Asset protection companies make tons of money selling solutions to people who are scared of being wiped out by creditors. An offshore asset protection trust can cost $20,000 to $40,000 to set up. Plus there are annual fees owed to the offshore trust company.

As you consider how to protect yourself, beware of heavily marketed schemes. They offer quick answers and seem too good to be true. Examples include Asset Protection Trusts and Bridge Trusts.

(Our strategies are trie-and-true, and cost half that amount, with no annual fees.)

When it comes to your wealth, you should always be sure that the strategies you use are legal and reliable. Do your due diligence. And make sure any strategy you consider is backed by legal precedent before investing in it.

Do You Want Bulletproof Protection Supported By Generations of Case Law?

We use techniques that are proven to work. For example, our Asset Vault Trust is a type of Special Power of Appointment Trust that has worked for generations. It has withstood attacks in every state and even by the federal government. There are no cases saying that it does not work.

Compare that to Asset Protection Trusts and Bridge Trusts that have cases demonstrating their weaknesses. Even offshore asset protection trusts have been defeated by U.S. courts.

If you want bulletproof, proven protection, give us a call at 602-443-4888.

ABOUT THE AUTHOR

Founding attorney Paul Deloughery has been an attorney since 1998, became a Certified Family Wealth Advisor. He is also the founder of Sudden Wealth Protection Law.