The money and property that you’ve worked hard all your life to build i.e., your nest egg, your savings and all that you own are also known as your assets. The dictionary (Dictionary.com) defines assets as:
Assets can be defined as:
- items of ownership convertible into cash; total resources of a person or business, as cash, notes, and accounts receivable, securities, inventories, goodwill, fixtures, machinery, or real estate (opposed to liabilities ).
- Accounting. the items detailed on a balance sheet, especially in relation to liabilities and capital.
- all property available for the payment of debts, especially of a bankrupt or insolvent firm or person.
- Law. property in the hands of an heir, executor, or administrator, that is sufficient to pay the debts or legacies of a deceased person.
You may be expecting that your assets will keep you comfortable later in life, that everything you’ve worked for was to enable you to retire and have a certain standard of living or lifestyle, perhaps even provide funds for your end of life care and funeral expenses.
The truth is, your assets are at risk, and the is a very real possibility that you could lose your nest egg and have to start over if you don’t take steps to protect your assets now. Threats to your security can come from unknown quarters so it’s wise to be prepared for various contingencies. The purpose of this article is not to alarm you, but to inform and enlighten you about something that could come out of left field and really mess up your plans.
5 Statistics You Should Know
- If you’re in business: 50% of businesses fail within the first year, and 95% within the first 5 years.
- If you’re married: 30%-40% of marriages end in divorce. The statistics are even higher for subsequent marriages.
- If you’re aging: 10% of the population is now over 60 years of age. 1 in 7 men will get prostate cancer, and 1 in 8 women will get breast cancer. Catastrophic medical issues are the most common cause of financial difficulties.
- If you’re financially solvent: Each year 15 Million lawsuits are filed in the U.S. The likelihood is great that you will be sued. Your odds go up the more money you make.
We’re not saying you’re going to be a statistic, and we hope you won’t be. Still, the odds are rather stacked against you. There are other circumstances that might be damaging to your financial well-being. Some you may not have considered.
5 Unexpected Expenses That Can Hurt Your Financial Future
- Taxes: Property tax, capital gains, and inheritance tax are only a few of the unexpected taxes that might become due. If you own property, sell property or if your spouse or a family member passes away, your savings can be eaten up by these taxes.
- Judgments: You may have a judgment against your company or person in one of the 15 million lawsuits that are filed annually in America. This unexpected expense could run into the many thousands.
- Medical Expenses: This is a big one. If you or your spouse or partner become critically ill, the medical bills not covered by health insurance or Medicare could financially devastate you.
- Loss of Income: If you haven’t done the proper planning earlier on, the loss of income if you become unable to work or are forced to retire can put you at a financial disadvantage.
- Fraud: Businesses report nearly $200 Billion in payment card fraud annually. Unfortunately, fraud of all types including identity theft, credit card fraud, social security scams, and other criminal activities are on the rise. If you are a victim of fraud, you could be ruined financially. It takes months and even years to recover from theft or fraud.
5 Ways Your Attorney Can Help You Protect Your Assets
- Estate Planning and Living Trusts: Your attorney may advise you to create a living trust. This document allows you to plan for future expenses, assign your assets to your desired heirs and in many cases, protect your surviving spouse and heirs from taxes and other financial hardships.
- Incorporation or creation of an LLP: Creation of a corporation or limited liability partnership for your business may be advisable to protect your personal assets in the event of a claim or lawsuit against your company or business partner.
- Investments: Your attorney may advise you to invest your savings in real property such as purchasing a home or to invest in some long-term strategies to ensure your financial stability.
- Tax Deferment Plans: Depending on your employment status and age, you may be advised to place your funds into a tax-deferred savings plan to build those assets towards your retirement and to defer tax payments until later.
- Insurance /Annuities: Your attorney may advise you to purchase certain types of insurance or annuities that will build equity, and pay dividends later in life.
No matter what your current situation. You can breathe a lot easier knowing that you’ve planned and saved and done everything you can to protect not only your own financial future but that of your loved ones after you pass away.
When you’re ready to get it all dialed in, the attorneys at U.S. Wills and Trusts are here to help. They’ll interview you about your current status and what your wishes are and help you to create a comprehensive estate plan that will protect your assets and your family’s financial future. Check out the website for more information https://www.uswillsandtrusts.com or call 714-584-7492 to get unlimited call time with an attorney who knows all about how to get it done right.