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Asset Protection Strategies

The Basics

It’s a dangerous world out there, and the more success you garner as a professional or business owner, the more you’ll need to protect your assets. Once you’ve started to acquire any quantity of assets, you’ll have to come up with a plan to protect them against creditors, predators and that ever-voracious taxman. Doing this well calls for a bit of judicious organization and the help of an experienced estate planning lawyer.

The available strategies for protecting your assets are numerous and complex. Here are some popular ideas from the asset protection attorneys at Heffel Law Firm.

Jointly-Held Accounts

If you think joint accounts sound like a good idea, you might want to think again. Whether you enter this sort of arrangement with a minor child, a senior parent, a spouse or a business partner, each participant in any type of joint account is putting his financial health at serious risk. While all may be roses at the beginning, trouble could soon arise if one partner should take it upon himself to withdraw funds without the other’s knowledge or permission. Things can go downhill even faster if one of the participants should:

  • Become embroiled in a lawsuit.
  • File for divorce.
  • Run afoul of the tax collector.
  • Overdraw the account.

If this sort of thing should happen, the innocent party to the jointly-held account is nevertheless equally liable. From a legal standpoint, the equity in a joint account belongs to each participant equally. The risk does as well, and since both participants have equal access to this type of account, you’d better trust your partner implicitly.

The potential problems with joint ownership extend beyond bank accounts. Each of the parties to a joint business partnership, loan, home purchase or anything similar is courting an identical sort of risk. If such a situation should prove unavoidable, try to keep the total investment as low as you possibly can.


Your financial liability will vary with your choice of profession. For instance, the medical fields are famous for exposing doctors and dentists to malpractice proceedings, but no professional who deals with the public is ever entirely free from the threat of a lawsuit. The right kind of insurance will go a long way to mitigate any possible impact. Here, your choices include:

  • Homeowners insurance. This will protect your interests if someone should come to harm within the boundaries of your property.
  • Commercial liability insurance. Designed for the defense of business owners, it covers you if someone is injured on your premises or suffers harm at the hands of an employee.
  • Workers’ compensation insurance. If you have even one worker in your employ, the law will mandate that you carry this protection.
  • Auto insurance. Always buy the best and the most you can afford.
  • Umbrella coverage. This insurance will have your back in all cases for which your regular policy fails to meet your needs.
  • Long-term care insurance. Whether you receive it at home or in a nursing facility, long-term care for chronic ailments can wipe you out financially. Buying coverage while you’re still young and healthy will help reduce the size of your premiums.

Small Business Strategies

If you own your own business, it is vital to do whatever you must to keep your personal assets separate from those of your company. To protect your private holdings from creditors and lawsuits, your choice of commercial entity is paramount. In this realm, the most common options are:

  • Sole proprietorship.
  • General partnership.
  • Limited partnership.
  • Corporation.
  • Limited liability company or LLC.

With a sole proprietorship, any claim against the business itself is also a claim against its owner. A general partnership is nearly as bad since equal partners in business are at the same risk as those in any sort of jointly-held account. Limited partnerships, corporations and LLCs will be far better at protecting your personal assets, and the attorneys at Heffel Law Firm can help you decide on the best course of action.