If you have something that you’ve worked your entire life to obtain and maintain, don’t be all that surprised when there are plenty of hungry wolves who desire to take it all away from you. The greatest mistake that a person who has accumulated wealth can make is in not protecting that wealth and preserving it for future generations. In an increasingly up and down, unpredictable economy, wealth preservation, paramount to asset protection, has never been as important as it is today. Take the following four considerations into perspective if you do not yet have adequate asset protection measures in place.
Shielding Assets from Liability
Meet Bob. Bob was a very successful entrepreneur. He developed a company that took off, quite literally, like a rocket. Before Bob even knew it, he was super-duper wealthy. And Bob was not the forward-thinking asset protection guy he could have been. He had a bunch of monies tied up in his LLC. It owned cars, houses and he owned a nice chunk of the entity. But one day Bob got sued. They levied his assets, seized his stocks and liquidated them, sold his houses and took his cars, all after seeking to deprecate his company and personal bank account to satisfy liability. Had Bob put effective asset protection methods into place prior, his creditors seeking damages on that big fat lawsuit he lost would have been penny dry up stone creek, while Bob enjoyed asset protection in the aftermath. Plainly put: Bob needed to act before he was wealthy; before he was a target; and before he got sued.
Properly Planning Your Estate
Your estate is an area of concern for asset protection, too. If you do not properly protect your estate with appropriate estate planning, a number of undesirable things can occur after you are gone.
- Your immediate family members become blood thirsty sharks, and tear each other to bits in court fighting over your estate.
- The federal government comes in and takes half, rather promptly, for taxation reasons.
- Your wealth is not divided up and allocated and distributed to the parties of your choosing.
- Your estate ends up in probate limbo for a hellish period of time.
- Estate fees skyrocket and drain the resources of the estate.
Reducing Tax Liability
Another benefit of asset protection is that you can reduce your tax liability. Now this is NOT to be confused with anything illegal, like tax evasion. Rather, reducing your liability involves a meticulous and intricate method that your tax attorney employs that enables you to enjoy the many cushy windows offered by the IRS for reducing your liability on your earnings. In so many words: why pay more in taxes than you have to?
Safeguarding Your Legacy
It’s your legacy. You spent your life building it. Don’t you want to know that it’s going to be protected long after you are gone? Certainly, you can’t take it all with you. But that doesn’t mean you have to leave a mess behind for your family to clean up after you depart this earth, either. With good asset protection methods in place, your legacy will be safeguarded.