How do I protect my assets from lawsuits?
Answer:
I have known people who put large sums of money in life insurance policies because they are protected from creditors.
*Don't tell anyone that I told you that*
Don't do anything that will get you sued is the best way. Forming a corporation will protect you from business lawsuits.
cash. gold, diamonds all burried in the back yard
Relinquish ownership, put your assets in another person's name and therefore their control, obviously someone you trust, who will return the assets when the legal problems are over, and not squander them in the meantime.
Your first line of defense should be to have adequate insurance. Get an umbrella policy for your personal assets and if you run a business make sure your comprehensive general liability policy has adequate coverage. Both policies should have at least one million in coverage. Consult your insurane agent to make sure all of your policies have adequate coverage.
Your second line of defense is to incorporate your business, if you have one. Do not do business as a sole proprietor or as a partnership. Either incorporate or organize a limited liability company. Consult your lawyer to find out if a LLC is an option in your state and consult your CPA to see which entity offers the best tax advantage. Either entity will provide a liability shield for its corporate shareholder or LLC member.
Third, do a review of your activities, personal and business. Look for areas of exposure and risky activity. then minimize your risk.
Fourth, retain a lawyer licensed to practice in your state and have her/him review your situation. Also, have an estate planning lawyer look into whether a trust of some kind can help to shield your assets.
Incorporate a "business" and make as many of those assets part of the business as possible. Own nothing - personally. Failing that, liability insurance to an incredible level is another option. As to "protecting" your assets, from what? Personal injury litigation? A divorce? Sexual harrassment litigation from an ex-spouse, worker or lover?
"Protecting" one's assets is harder the more risky one's lifestyle and attitudes are.
Be a good person - protect your REPUTATION and CHARACTER - and you'll find that protecting "assets" isn't that important. Or as necessary. For example, I'm not sure anyone ever sued Sam Walton .
The problem, too, is . what do you call "assets"? Cars? A house? Big bank account? Airplane? Antique guitar collection? Investment portfolio? Just win the lottery and don't want your "ex" to find out until the divorce is final? Don't confuse "material goods" with "assets".
If you're crooked or deceitful, "protecting" personal assets will be almost impossible - - if certain entities come down on you. Proof? The late Ken Lay and Jeffery Skilling of Enron found out. So, too, did Martha Stewart. The folks at Adelphia. Executives at WorldComm.
A trust get a lawyer
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