If you have assets, then you need protection. Protection from creditors, civil suits, the IRS, even possible future claims of a spouse. Obviously, not all assets can be or are meant to be protected from creditors. Creditors typically make a secured loan on the basis that one or more assets would be collateral for the loan. Asset protection does not imply hiding an asset; even the most secreted assets have ways of being unearthed by creditors as we do live in asset traceable/discoverable society.
So there is no hiding of assets, but there is—if you are wise—comprehensive estate planning that leverages several kinds of tools to protect your assets. Estate planning should entail asset protection, as well as long-term planning strategies that can realize the objectives of both estate planning and asset protection simultaneously. You want to make sure that you have the protections in place while you are alive to safeguard your assets from creditors and also grow your estate so that your loved ones are cared for after you pass.
A recent Fort Meyers Florida Weekly article, titled "Take measures to protect your assets into the future," reminds us that while federal law applies to protection of some assets, such as IRAs and retirement plans, state law also plays a part in choosing the ideal products and strategies for the protection of your assets. For instance, the article reminds us that not every state treats homesteads or life insurance in exactly the same manner.
The more assets you have, the more extensive your estate plan should be. However, even a regular middle class person can be subject to litigation or the seizure of personal assets to satisfy corporate debt. So if you are a millionaire or even if you are not, you should seek the assistance of your estate planning attorney. He or she can examine all of your current and potential assets and liabilities, and create a plan that makes the most sense for you and your circumstances.
Do not wait to meet with your estate planning attorney until the creditor calls or you are served with a civil complaint. At that point you cannot simply move assets from a creditor's reach prior to a judgment. That will be viewed as fraudulent conveyance—remember, it is against the law to hide assets.
There are several exceptions to what a creditor can get at, and it takes a skilled attorney who specializes in this area to create effective vehicles to protect your assets within the confines of state and federal law. Talk to your estate planning attorney sooner rather than later. Make a point of setting up an appointment right away.
Reference: Fort Meyers Florida Weekly (July 23, 2014) "Take measures to protect your assets into the future"