The Three Pillars of Asset Protection

More and more Americans are beginning to understand the importance of preserving their wealth from creditors and plaintiffs through genuine and valid asset protection techniques. Unfortunately, this has also meant the creation of a veritable industry comprised of so-called asset protection advisers, who hawk pre-constructed “bulletproof” asset protection programs.  The sad fact is that many of them are not actually asset protection at all, but cleverly designed tax schemes which will neither protect your assets or save you taxes.

So, how do you figure out what kind of asset protection plan works best for you?

Your Asset Protection Plan Should Protect You From Liability.

This is the precise reason why it’s important for you to choose a plan that has been customized to fit your needs. Beware of asset protection advisers hawking “Constitutional Trusts” and “Pure Trusts,” regardless of your needs or your wealth preservation objectives. Also consider that your wealth preservation needs as a highly successful cosmetic surgeon may not be the same as those of a small business owner. Your plan must take into consideration your needs, and prevent all kinds of plaintiffs from getting to your wealth.

Your Asset Protection Trust Should Also Not Be Based on Secrecy or Privacy.

If someone promises that the way to protect your assets is to ensure the assets are not traceable back to you is giving very poor advice. Asset protection works because the laws of the jurisdiction prevent unwanted creditors from reaching your assets.  For this, it’s important that your trust be set up in a jurisdiction that allows your objectives to be met.

Your Asset Protection Should Be Done As Soon As Possible

The process of preserving your wealth is best begun before your wealth comes under attack. Therefore, the time to begin protecting your assets is now, before you have been named in a lawsuit. Once a lawsuit has been filed against you, setting up a plan becomes much more difficult and usually much less effective.

In any case you want to seek qualified advice for any planning and make sure that you don’t let a secondary “benefit” undo your primary goal of protecting your assets.