You’ve worked hard all your life to build up your assets. You’ve finally managed to acquire a decent asset portfolio. Now you need to protect those assets. One of the biggest estate planning mistakes people make is failing to recognize the need to consult with an asset protection attorney. They typically make this mistake because they do not realize how at risk their assets really are. After you take the time to consider the following ways in which your assets might be at risk, you will undoubtedly understand the need to incorporate asset protection strategies into your estate plan.
Ways in Which Your Assets May Be at Risk
Like many people, you may have your assets safely tucked away in an insured account or taken other rudimentary measures to ensure that your assets are safe – and left it at that. Consequently, you may not even recognize how at risk your assets might be. Take a moment to consider the following potential risks to your assets:
- Divorce –your own divorce will certainly put your assets at risk; however, have you also considered how the divorce of a child, or other beneficiary, could impact your hard-earned assets? If you gift your estate to a child when you are gone, and that child co-mingles his/her inheritance, your gift could be lost to your child’s spouse in a divorce the same way assets can be lost in your own divorce.
- Economy – the reality is that the economy can be a threat to anyone’s assets because it can be unpredictable and volatile. A downturn or recession can put all your assets at risk.
- Business failure – if you own a small business and you incorporated the business, you may be under the impression that you have protected yourself from any personal liability for the debts or errors of the company; however, you could be wrong. Simply creating a corporation is not always sufficient to protect yourself from personal liability.
- Beneficiaries – your own beneficiaries could be the biggest threat to your hard-earned assets. Once a direct gift is made to a beneficiary, there is nothing anyone can do about how the beneficiary spends those funds or handles those assets. A beneficiary could lose everything as a result of a drug or gambling problem or simply because he or she is bad with money.
- Spouse – even if you and your spouse remain happily married, your spouse could still be a threat to your assets because you can be held legally liable for your spouse’s debts. At the same time, if you leave everything to your spouse, and your spouse doesn’t protect those assets after you are gone, everything you did while you were alive to protect those assets will be for nothing.
- Long–Term Care – if you, or a spouse, need long-term care (LTC) later on in life, the cost of that care could be a serious threat to your assets. Because neither Medicare nor most private health insurance policies will cover LTC expenses, you may be forced to pay out of pocket, at an average cost of around $10,000 per month, or qualify for Medicaid. If you failed to plan ahead, qualifying for Medicaid could cause the loss of your assets as a result of the Medicaid “spend-down” requirement.
How Can an Asset Protection Attorney Help?
Now that your eyes are open to the numerous and varied potential threats to your assets, the need to consult with an asset protection attorney should also be clear. By discussing the various threats to your assets now, you and your attorney can devise an asset protection plan that will protect your hard-earned assets both now and in the future.
For more information, please join us for an upcoming FREE seminar. If you have additional questions about the need for assets protection strategies in your estate plan, or you wish to consult with an asset protection attorney, contact the experienced New Jersey estate planning lawyers at Augulis Law Firm by calling 908-222-8803 to schedule your appointment today.