Health & Fitness
Top Ten Asset Protection Maxims
Top Ten Asset Protection Maxims
Generally speaking, asset protection (sometimes also referred to as debtor-creditor law) is a set of legal techniques and associated bodies of statutory and common law dealing with protecting the use, benefit, enjoyment or ownership of assets of individuals and business entities. The general goal of asset protection planning is to insulate assets from both the claims of creditors and value loss without concealment, tax evasion or fraud. When planning the following maxims may be considered:
1. Don't Look at the World Through Rose Colored Glasses; It Could Happen to You
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Life is not always fair. Bad things can and do happen to good people, including you, your business or family.
2. Failing to Plan is Planning to Fail
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If you put off doing what you ought to do, or worse, do nothing at all, you will likely end up either not having enough time to do it properly or simply fail. Make a plan, be deliberate and keep the plan updated.
3. Get Your Ducks in a Row
4. Purchase Liability Insurance and Leave Someone Else Holding the Bag
Casualty, umbrella, directors and officers, errors and omissions and other forms of liability insurance should be the "first line of defense." Best to let an insurance company pay for the defense and pay for the claim. Legal planning, although necessary, should supplement and not supplant insurance planning. Transference of liability exposure to a third-party insurer is smart.
5. Plan Early; Especially During the Good Times
It is important to plan during good times far in advance of any potential claims or threatening liability situations. Planning after a claim has raised its ugly head and reacting may lead to planning being undone and deemed a "fraudulent conveyance."
6. Control Freaks Beware; No Pain; No Gain
To attain asset protection the retained use and possession of an asset cannot be unfettered. So, if the pain of fettered use and control does not exist then the gain of asset protection will likely be limited or lost.
7. Don't Mix Business with Pleasure
Limited liability companies, corporations and partnerships are for commercial and business pursuits, not for personal. Keep business and personal distinct. Placing personal use and pleasure items into business entities is a "red flag" and exposes the liability protection veil of the business entity to be more readily scrutinized and pierced thereby lessening protections. Personal assets are best addressed with long established and effective trust planning.
8. You are Judged by the Company You Keep
The best asset protection is "avoiding problems before they occur." So, be careful when choosing partners, customers, business associates, clients and spouses. The folks closest to you can hurt you the most.
9. Don't Put All Your Eggs in One Basket
Compartmentalizing liability exposure and diversifying creditor attack risk by allocating assets among various, redundant and separate entities and/or persons is fundamental to sound asset protection. This maxim applies to personal as well as corporate balance sheets.
10. All is Not Fair in Love and War
Most would agree that marriage should be about love and that divorce should not be about protracted litigation wars and associated financial hardship. In today's world, when couples, rich or not, address marriage and finances, intelligent starting-points include both premarital agreements (before marriage) and post-marital agreements (after marriage) to control and protect their privacy, emotional harmony and assets. Both prenuptial and post-nuptial agreements allow couples more input into marital issues such as "what is a fair division" and lessens the interference of third parties and the courts. The control, freedom and privacy provided by marital agreements should be a cherished and protected starting-point-default.Kelleher & Buckley, LLC has the experience and know-how to help you legally protect your assets. To find out how we can help, call Andrew J. Kelleher at 847-382-9130 or email us at attorneys@kelleherbuckley.com to speak with one of our attorneys. We also appreciate your referrals.
For more information on Kelleher & Buckley, LLC, please visit our website at http://www.kelleherbuckley.com/.
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