Asset protection has become an increasingly popular service provided by estate planning attorneys due to many threats that face those accumulating even moderate levels of wealth. Before you know what type of asset protection strategy to implement, you must first understand the most common threats to your assets.
Long-term Care
Most people of retirement age are well aware of the soaring costs of healthcare and long-term care services. As we age, everyone will need some type of care in their later years. For those who experience excellent health, it may be more affordable to maintain independent living for as long as possible. Unfortunately, we are not always in control of whether that remains a possibility. For those who need more advanced care, the costs can be extremely burdensome and cut drastically into your overall net worth. There are asset protection strategies available that specifically address long-term care needs. Proper planning can help prevent diminishing your assets.
Spouse
You are liable for your spouse’s debts and liabilities. The way marital assets are held and titled can have a huge impact on how creditors gain access to those assets. Part of asset protection planning is reviewing how these marital assets are titled.
In-Laws
After you pass away and leave your assets to your children, they may end up being squandered by your son-in-law and/or daughter-in-law. As mentioned above, a spouse is liable for the other’s debts. Your in-laws’ creditors may end up gaining access to the assets you intended for your children to enjoy. There are ways to prevent this as well, with the right advance planning.
Beneficiaries
Outright gifts and inheritances to your beneficiaries may end up occurring before the beneficiary is mature enough to handle it properly. Rather than preserving the newly inherited wealth, the beneficiary may squander it, gamble it away or use it to feed an addiction. Using a trust with terms and conditions, you can preserve your hard-earned wealth and require beneficiaries to wait to a certain age, only get partial distributions according to a timeline you determine, or meet certain conditions to gain access to the assets. An experienced estate planning attorney can help you brainstorm various terms and conditions to include in a trust to accomplish your asset protection goals.
Estate Taxes
If the combined value of all lifetime gifts and assets owned at the time of your death exceeds the current lifetime exemption amount, your estate will owe federal estate taxes and Maryland estate taxes. Minimizing estate and gift taxes is a part of proper estate planning.
For more information on avoiding these threats to your assets with asset protection planning, contact the creative and knowledgeable attorneys at Stouffer Legal in the Greater Baltimore area. You can schedule an appointment by calling us at (443) 470-3599 or emailing us at office@stoufferlegal.com.
