Wealth Protection


Wealth Protection

The assets you've worked your lifetime to accumulate could be lost in an instant if they are not properly protected and you are sued. There is one rule in protecting your assets from creditors, "Don't wait until you're in a position to be sued to take action." Sit down with a Veracity Financial Services partner to take the necessary preventative measures to protect what you've worked so hard for.

Don't Delay

We all heard the best defense is a good offense, so naturally the best way to protect yourself from creditors is to avoid lawsuits. However, America is becoming a more litigious society, and it's increasingly common for people to be involved in legal proceedings as a result of everyday activities and accidents.

You must protect your assets before a lawsuit is filed and before the cause of the action occurs. Failure to do so is considered by law to be a  fraudulent transfer intended to defraud creditors.

Anyone With Assets is at Risk

Similar to estate planning, anyone with assets can benefit from assets protection strategies. It's not solely for the exceptionally wealthy. There are many circumstances in which your assets can be seized. These include if your business files for bankruptcy, you get a divorce or you are on the defensive end of a civil lawsuit.

Laws Protect Certain Assets

Federal and state laws determine what assets are protected and what assets are subject to forfeiture. It's important to meet with a Veracity Financial Services partner to discuss State law and your situation.

Your Home
The amount of protection you have on your home varies widely from state to state. It's important to meet with a Veracity Financial Services partner to discuss State law and your situation.

Annuities and Life Insurance
State laws determine the level of protection that applies to annuities and life insurance. Some protect the cash surrender values of life insurance policies and the proceeds of annuity contracts. Sometimes they only protect the beneficiary's interest. There are also states that do not provide protection at all. It's important to meet with a Veracity Financial Services partner to discuss State law and your situation.

Please Note
The U.S. government and a spouse currently in divorce are the only creditors capable of obtaining assets, regardless of the type of fund or types of asset protection.

Different Strategies for Protection

There are a variety of legitimate strategies that can help you protect your assets. Click here for Forbes Ten Rules for Asset Protection Planning. Below are the most common tools to protect assets from creditors. It is important to make an appointment with a Veracity Financial Services partner to discuss your unique situation and applicable state laws.

Asset Protection Trusts
Offers a way to transfer a portion of your assets into a trust run by an independent trustee. The trust's assets will be out of the reach of most creditors, and you can receive occasional distributions.

Equity Reallocation
Is as simple as taking the equity out of a non-protected account/item and moving that cash into assets your state protects.

Simple Ways to Protect Assets
There are some inexpensive ways to protect assets that anyone can implement:

  • Get an umbrella policy that protects you from personal-injury claims above the standard coverage offered in your home and auto policies.
  • You could transfer assets to your spouse's name. Be aware that if you divorce, those assets could be forfeited.
  • Put more money into your employer-sponsored retirement plan because it might have unlimited protection.
  • Keep your business assets separate from your personal assets. If your company runs into a problem, your personal assets might not be at risk.

Veracity Financial Services is a division of Capital Markets IQ, LLC, a SEC registered investment advisor. 

© 2016 Veracity Financial Services, Inc

The content is developed from sources believed to be providing accurate information. The information in this material is not intended as tax or legal advice. It may not be used for the purpose of avoiding any federal tax penalties. Please consult legal or tax professionals for specific information regarding your individual situation. Some of this material was developed and produced by Veracity Financial Services, Inc., to provide information on a topic that may be of interest. The opinions expressed and material provided are for general information, and should not be considered personalized investment advice for compensation.