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Asset protection planning is a set of risk management devices designed to limit one’s exposure to an adverse judgment. Possible candidates are those who own businesses that are subject to uncertain but large and uninsurable litigation risks or others who worry that their potential legal liability may destroy most of their savings.
To be frank, judges are never sympathetic to asset protection plans since they typically make the business of enforcing a judgment more difficult. Nevertheless, asset protection planning is reluctantly recognized as a legitimate exercise of risk management in the area of debtor-creditor law and has been continuously practiced within the common law tradition since at least the beginning of the seventeenth century.
Significantly, asset protection planning is to be done, if at all, prior to the commencement or contemplation of a lawsuit. The transfer of assets once a lawsuit has been filed is potentially subject even to criminal charges as a fraudulent conveyance and should not be done under any circumstance. However, safeguarding against the worst can save you your fortune.
Deciding whether to use an asset protection plan—and which sort to use— requires a thorough risk analysis of the individual in question, his or her lifestyle, and his or her business. Factors to consider include the likelihood of potential lawsuit, the magnitude of the potential loss, the potential benefits of an asset protection plan, the costs of an asset protection plan, and the efficacy and cost of the existing or alternative protections, such as insurance.
Contact us for a free first consultation to determine what issues are presented by your family’s financial and medical circumstances and to receive an estimate for the work to be done. Most services our firm offers are performed on a flat-fee basis.