Asset Protection

Has anyone done any asset protection?
Edited to add: I am talking about asset protection with respect to high risk professions - like doctors. Not asset protection due to the current fiscal nightmare. Although our spouse can carry malpractice insurance, rewards can exceed malpractice coverage amounts, there are suits outside of malpractice like sexual harassment, and many frivolous patient suits.

- If so, any firms that you like? I am looking at a few firms right now and getting deluged in info. Can't say I have any recommendations since I am just getting to the meat of it all.
- If not - why not?
- Since this could effect your whole family is this something you discuss with your spouse?

[Vanquisher]

Re: Asset Protection

If I had any assets, I would protect them.

We have life, disability, homeowners, and auto insurance. We just barely got the life and disability policies. We went with a guy whose wife is a physician, and he gets it. He works for Northwestern Mutual. We got Guardian for disability and Northwestern for life.

[Cumberland]

Re: Asset Protection

My understanding is that if your assets are below 100K, then they are FDIC insured provided they are in an FDIC insured bank. Since our chump change is currently residing with merrill lynch it is supposedly ok.

[Sheherezade]

Re: Asset Protection

100 K per bank is FDIC insured if they are in traditional accounts. Money markets are not insured, but I believe the Fed said earlier this week that they would insure them after a major money market firm said they would pay less than 100 cents per dollar in each account. :huh:

I read a disturbing article the other day that stated that the "bail out" provisions for FDIC insured accounts were limited to 30 billion dollars at which point the government has the right to use "market values" or some such thing. Only 30 billion for the citizens??? I know all the banks wouldn't fail at once....but jeez.

Obviously this was written in a different era when we weren't talking 700 billion dollars for failing investment firms. I'd imagine that they'd have to raise that limit if say....Citi or Bank of America went under.

Re: Asset Protection

Sorry for the confusion - I am talking about asset protection with respect to being married to a doctor. I edited my original entry.

If I had any assets, I would protect them.

I think the idea is to get these safeguards setup before you have any real assets and as close to the start of the practice as possible. The longer these trusts are in place, the stronger they are [from what I am getting so far].

[JaneDoe]

Re: Asset Protection

The steps we have take for purposes of asset protection include: setting up QTIP trusts for both of us, Dh formed an LLC, we have life insurance, disability insurance, and accountant that reviews Dh's business quarterly as well as prepares his taxes.

[Vishenka69]

Re: Asset Protection

We currently don't have any assets to protect but have talked about getting an umbrella insurance for those "just in case" moments. Other than that we've briefly discussed opening investment accounts (some time in the future) in my name.

Wasn't there some sort of legislature that your primary residence can't be taken away?

Re: Asset Protection

Janedoe, did he set up the LLC for his business or was that something separate?

We have life for both, disability for him, and an umbrella policy. My to-do list includes making new wills. DH will be starting on partnership stuff soon -- in this case it is a corporation and not an LLC. I think we will be needing some outside advice on all of this...

[Momo]

Re: Asset Protection

100 K per bank is FDIC insured if they are in traditional accounts.

It's 100K for an individual's account per FDIC insured bank and up to 200K for a joint account per FDIC insured bank .

[KCwife]

Re: Asset Protection

Wasn't there some sort of legislature that your primary residence can't be taken away?

It varies state to state. In some states, such as Kansas, it is a great idea to put a great deal of money in your home as it is protected. In other states, it is capped at a measley amount... like 100k or so. In a few states, your home is not protected at all.

[JaneDoe]

Re: Asset Protection

Janedoe, did he set up the LLC for his business or was that something separate?

Dh set the LLC for his business. It is for purposes of liability; i.e, if someone slips and falls on his building's premises, it would be hard to come after Dh's personal assets. The way Dh's practice is set up is that each of the doctors are in business for themselves, but they join together to share the overhead. So, after they pay their share of the expenses, they get to keep everything else that they produce. Of all the doctors in Dh's practice, one is just MD (sole proprietor), another is a PC, Dh and another Dr. are LLCs and I can't remember what the other Dr. is. Once Dh is generating more income, he will convert to a S Corporation.

I forgot to add that we also have an umbrella policy. Additionally, as part of preparing the trusts, our attorney recommended that we put the house in my name. Of course, we followed that advice!

Re: Asset Protection

In some states, such as Kansas, it is a great idea to put a great deal of money in your home as it is protected.

This is good to know, since we plan to be back in KS in a few years & want to build.

We've also talked about putting things in my name, but I wasn't sure how well that really worked.

Obviously, we'll be getting advice on this once DH is done with fellowship. DH was just saying this week that although we really love our Edward Jones investor, we're not sure he has the experience to work with us on protecting assets. We may leave our IRA accounts, etc., with him but go with someone else for our other accounts.

[KCwife]

Re: Asset Protection

In some states, such as Kansas, it is a great idea to put a great deal of money in your home as it is protected.

This is good to know, since we plan to be back in KS in a few years & want to build.

We've also talked about putting things in my name, but I wasn't sure how well that really worked.

Obviously, we'll be getting advice on this once DH is done with fellowship. DH was just saying this week that although we really love our Edward Jones investor, we're not sure he has the experience to work with us on protecting assets. We may leave our IRA accounts, etc., with him but go with someone else for our other accounts.

We actually know an OB in KS who set up all business assets in a trust of some kind in his kids names vs. his wives. There was some sort of loop hole on it being in the spouse name. I would look into it... sorry I don't remember why or how.

Re: Asset Protection

Thanks, Janedoe! Good to know since we are in the same state. This is a good reminder to start thinking about this stuff. I can't remember if DH's practice is a C corp or S corp.

Re: Asset Protection

We actually know an OB in KS who set up all business assets in a trust of some kind in his kids names vs. his wives. There was some sort of loop hole on it being in the spouse name. I would look into it... sorry I don't remember why or how.

That's kind of what I thought - that it wasn't protected enough in the spouse's name. Hadn't thought of putting it in the kids' names, though... perfect for college savings, inheritance, etc.