Five Wealth Preservation Strategies

After the global financial crisis that occurred during the past decade, most people realize that it is not enough to accumulate wealth — it is also necessary to protect your assets. Strategies to preserve wealth are an important part of estate and financial planning. Deciding which strategies to employ is no simple matter in today’s economic environment of rising interest rates, market volatility, and conflicting personal financial goals.

The first step to take in preserving wealth is to consult with an experienced asset protection lawyer for skilled legal assistance in devising integrated wealth preservation, estate planning, and tax planning strategies. Our asset protection attorneys at DCDM Law Group have extensive knowledge of financial instruments and sophisticated strategies to protect your wealth and assets.

Strategies to Preserve Wealth

Optimum wealth preservation strategies integrate asset protection with effective business, estate planning, and tax planning strategies to significantly enhance overall family benefits. Your family wealth preservation plan may include a combination of strategies, such as:

  • Liability Insurance: Insurance coverage can be the first line of defense in your asset protection plan, in both your domestic and business affairs. Necessary coverage may include property and casualty, excess liability, officers and directors, or malpractice insurance. The amount of coverage you carry is an important factor in how much protection liability insurance can provide for your assets.
  • Life Insurance: When ownership is placed in an irrevocable trust, a life insurance policy is a tool that can protect assets from creditors, minimize estate taxes, and provide immediate cash to heirs after the death of the insured. Policy proceeds do not go through probate, and are not subject to estate or income taxes. In formulating the terms of the trust, the grantor is able to decide in advance and control how the life insurance proceeds will be spent.
  • Retirement Plans: Retirement planning is an excellent way to accumulate significant assets in a tax-deferred vehicle. ERISA sponsored retirement plans, such as 401ks and profit sharing plans, are also protected from creditor claims.
  • Property Ownership Alternatives: Property transfers from an estate to a beneficiary are subject to state transfer taxes, and property included in an estate increases the value of the estate for estate tax purposes. Ownership and family property titling can, in many cases, be amended to avoid probate and state and federal transfer taxes.
  • Trust Strategies: Trusts can be an effective asset protection tool in high-value estates. Irrevocable trusts are not subject to estate taxes, although the trust may have to pay income tax (at a higher rate than individuals) on interest and dividends. Although an irrevocable trust is no longer under the control of the grantor once funded, the grantor can control the terms of the trust and how the money will be distributed and spent.

Asset Protection Lawyer in Pasadena

Our attorneys at DCDM Law Group provide insightful assistance to our clients, and we are more than capable of resolving sophisticated estate planning and asset protection challenges. We take a holistic approach to asset protection, closing the gaps that less comprehensive approaches leave open. Contact our office for a consultation to discuss your wealth preservation and estate planning goals.