Thursday, October 24, 2013

Why You Should Know What Is Asset Protection

By Kelly Wood


In these times when the economy is still slow in growth and financial uncertainties are affecting many people, it is important to think about protecting your assets. Many people may ask the question, What is asset protection, and the answer to this query is simply safeguarding your assets from people or institutions that could take it away by means of lawsuits, taxes, penalties, repossessions.

If you are in a debt and the creditor files lawsuits to recover the debt, them your property is put at stake and you may lose it if the creditor wins the case. Moreover, if you are involved in a road accident and you are at fault, you could be subjected to a lawsuit, which also risks your property being repossessed to pay for the damages. These are real life experiences which can happen when you least expect them.

When purchase a home premise and you reach a situation where you are not able to repay the mortgage, the lenders may file lawsuits in court to recover the house. Car accidents can occur and you are at fault in causing the accidents. When this happens, you are subjected to a legal process to pay for damages you caused on other people and properties.

Your future finances and wealth management is partly determined by the financial goals you put in place. If you cannot plan for your finances, chances are that you will put your money into risks and your property may suffer. The retirement period is when people have retired from active work and their sources of income may be limited.

If you have lawsuits where creditors have filed lawsuits in court, you cannot defraud them because if you try to transfer assets so that creditors cannot access them, the court can reverse such transfers. However, you can start planning now before it is too late. This process requires a qualified attorney who understands the ins and outs of assets protecting techniques.

However, this arrangement is something that cannot be done so fast because it needs good planning for finances and estate. If you have ongoing legal suits, you may not protect your assets from those lawsuits. This is because even if you try to transfer the assets or change names, this may be seen as an attempt to defraud the creditors.

In asset protection, besides the financial plans, your estate is also comprehensively planned. This is achieved through addressing issues such as the persons who should take care of your properties and assets when you become mentally incapacitated. The persons who will take care of your heirs or children, spouse, and family members are also identified.

The estate plan also addresses issues pertaining with persons who will take care of your children, spouse, and other family members when you die. When you understand what is asset protection, you are able to seek professional advice in advance. You can start preparing on how to protect the assets from creditors and other institutions, which may try to repossess them.




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