Saturday, August 9, 2014

Why You Need To Consider Asset Protection Trusts

By Tanisha Berg


Creating wealth and acquiring assets requires hard work and takes time. However, at times, you may be faced with lawsuits that risk your personal wealth. It is essential you consider seeking asset protection trusts to safeguard your wealth. Some professions and individuals may be more likely to encounter increased risk of being faced with lawsuits than others. If you are an entrepreneur or a corporate board member, you could find yourself in lawsuits that demand you surrender your assets.

In treating patients, doctors can make mistakes, which amount to negligence act thus attracting lawsuits. Such lawsuits founded on medical negligence can be quite costly. If you operate a clinic or own your property, you may risk such assets to creditors like patients who have launched lawsuits against you.

Any omission or mistakes could further risk your property. Different people may have different customized solutions in managing their assets. It is important that you determine which assets need to be protected. With the economy still lingering in a tailspin, uncertainties can arise which put you into difficult situations.

If you are faced with a lawsuit, you may find yourself losing your wealth. Professionals such as doctors might make mistakes, which plunge them into lawsuits. The lawsuits may range from those related to negligence acts you have indulged in like causing an accident to those related to foreclosure of a home, which you have not been paying the mortgage advanced to you.

Sometimes, when you try to enter into trusts arrangements when there is a pending case in court, it may be seen as depriving the creditor the ability to access your assets. This could easily be noticed by the court and possible reversal of the asset protection procedure may be ordered. In planning for your assets protection, you ought to understand that some of the clauses such as the spendthrift are irrevocable.

Since the trustee holds the legal title for the property, it may not be easy for creditors to go after it whenever lawsuits ensue. Although a trustee is given the mandate to hold the legal title of your property, you and other designated beneficiaries retain the beneficial title. The trustee on the other hand is legally obligated to observe the terms that have been created based on the applicable law.

Business people are also encouraged to protect their assets through such arrangement. It is not only painful but also depressing to lose all that wealth you have acquired for a long time. Because there are many liabilities, which can befall a business person, they could risk the assets being taken by creditors. When you have borrowed a loan and you do not repay it, creditors may come after your assets to recover their debt.

When you protect your asset, it could mean you lose some control over them. But, this does not mean that you lose the economic benefit arising from the assets. While you might find this procedure not very welcoming in ownership of your property, you should look at the big picture and the long-term benefits.




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