Even if you have perfect credit, a paid-off home and no plans to engage in any high-risk activities, you can still lose all your assets. Anyone can be sued, which means your personal assets can be seized to pay those bills in the event you’re hit with a lawsuit. That’s why asset planning and protection in Miami, FL is so important. Here are our best tips to protect your hard-earned assets.
What is asset protection?
Asset protection is a term for using legal structures to protect your home, car, bank accounts and other assets from being seized to pay off creditors. It is a perfectly legal—and smart—way to completely or partially protect your assets. You can’t do it after you’ve been sued, so it’s important to start planning now.
Tips for asset protection
Here are some things to keep in mind as you set about protecting your assets:
- Move your rental or real estate investments into an LLC: If you’re a landlord or real estate investor, it’s very important that you move your assets into a limited liability company (LLC). This business structure protects your assets in two ways. First, if you are sued for personal debts or other liability, your creditors will not be able to seize your real estate assets, since they are business property. Second, if you are sued in relation to your property, such as after a slip and fall on the premises, your personal assets will be protected from liability. Instead, the creditors will have to look to your liability insurance in order to collect.
- Get liability insurance: Liability insurance is the best way to protect yourself against personal and business liability. Not only does it help you pay any monetary damages associated with a lawsuit, but it can also help pay all or part of the legal fees. Make sure you get business, homeowners, renters, malpractice and other insurance—it’s one of the best investments you can make, especially if you own multiple properties or a business.
- Maximize contributions to your retirement fund: In most cases, bankruptcy creditors cannot go after your 401(k) or IRA accounts. Investing as much as possible in your retirement fund is a smart way to keep your investments away from creditors and predatory lawsuits—plus, you’ll rest assured that you have plenty in the bank when it comes time to retire.
- Put certain assets in trust: Consider putting personal assets in a trust—your attorney can help you decide which ones are most appropriate for the circumstances. Trusts can help shield your assets from creditors and lawsuits, but they’ll also help loved ones avoid going through probate when you die. That saves them a lot of time and money during the grieving process, and limits your tax liability, too.
No matter what kind of assets you have, they can always use a little more protection in Miami, FL—and now is the time to start planning. Work with a skilled business or estate lawyer to ensure that everything you worked so hard to earn remains in your family. Call Ruben J. Padron, PA for a consultation today.
Categorised in: Asset Protection