Protecting your Wealth Now
Asset Protection Trusts
You want to ensure that your hard-earned wealth is protected and the risk of it being lost or significantly eroded by third parties is minimised.
We can assist you with advice and solutions to safeguard your wealth now. Your assets may be at risk due to your profession or because you run a business. We can advise you on a number of risk minimisation strategies which if you put in place early on, can be a very effective safeguard against loss. We can also assist with establishing and structuring your entities including family trusts, companies and self managed super funds.
Protecting your Wealth Later
We can assist you in getting your wealth safely to your intended beneficiaries and provide them with asset protection for the inheritance that you leave them in your estate plan. Too many inheritances are eroded or never get to your intended beneficiaries due to estate claims or unnecessary taxes that could have been avoided by careful estate planning. We can also advise you on asset protection vehicles such as Testamentary Trusts in a Will for your beneficiaries to hold their inheritance, so that the risk of loss in their hands is also minimised.
If you have entities
Control of entities by a person with a high risk of being sued weakens the asset protection of an entity. We can review your existing entities including your family trust, company and super fund to determine whether they have been structured in the optimal way to minimise risk. We can also advise you on the appropriate entity in which to trade or hold your investment assets to increase your asset protection.
Prevention is better than cure
Asset protection measures, to be effective, usually need to be done some years in advance of a loss event. When you attend your first consultation with one of our asset protection lawyers, they will discuss various strategies and make recommendations to you on how you can strengthen your asset protection position both now and in your estate plan. They will also provide you with a written fixed fee quote to do any recommended work.
Why is asset protection important?
After spending many years building up your assets, you’ll want to take steps to safeguard your assets from claims. Without an appropriate asset protection plan, your property, money, and other assets could be vulnerable to attack both during your lifetime and after your death.
During your lifetime you could be potentially sued for a number of things. For instance, claims could be brought against you if someone has a slip and fall at a property you own, or if services you have rendered are negligent and your insurance does not cover you. Therefore, advice around how you hold your assets could be beneficial to minimise the risk of these assets being available in a claim if it was successful.
On your death, there is also the potential of having your estate sued by an eligible applicant who has missed out on being provided for. Depending on the situation, your estate could risk losing a large sum of money to such claims. Discussing estate asset protection with your asset protection lawyer could substantially minimize this risk. Our team of career dedicated asset protection lawyers at estate first have expertise in this area and can assist you with your queries. Contact us today.
Who should worry about asset protection?
Anyone who owns real estate, a business, is in professional services, or possesses wealth that they want to be passed on to their family after their death should consider asset protection as part of their estate planning process and/or their overall financial plan.
There is no set dollar amount of wealth that makes an asset protection plan worthwhile. Most people will benefit from some level of asset protection planning regardless of their specific level of wealth. By working with a team of experienced asset protection lawyers, you’ll end up with a plan that aligns with your goals and your current financial situation.
What is an asset protection trust?
Creating a trust and housing your assets within it is one way to potentially shield your assets if you are sued. An asset protection trust is a carefully drafted vehicle which, if prepared properly, can assist you and your intended beneficiaries in holding wealth intergenerationally with greater safeguards against claims as opposed to holding it outright in a lot of circumstances. There are however limits in how useful an asset protection trust can be, and there are tax and other implications for such a trust. These must be fully discussed with your asset protection lawyer to see if this is an appropriate solution for you. Contact us today if you’d like to learn more about asset protection trusts. We’ll talk to you about whether or not a trust may be a good fit for you and your family.
When should you start an asset protection plan?
In order for any legal and financial safeguards to work, you have to initiate them before something happens to you. For example, you may not be able to action the transfer of assets if you were incapacitated, or if you were in the midst of a claim (such as a divorce or bankruptcy).
As with most forms of financial advice and estate planning preparation, it’s always better to look at getting asset protection advice sooner rather than later. Call 1300 132 567 today to set up an initial consultation.
Talk to Us Today
Please complete the form below. Alternatively, you can call us on 1300 132 567.
Our unique ‘4 easy steps’ makes the process easy
Expert Estate Planning with Fixed Fees
Meet With Your Lawyer
Whether we meet virtually or face to face, we will listen, answer your questions, craft your estate plan and provide you with a fixed fee quote.
We’ll Keep You Updated
You will receive draft documents to review. You can discuss your plan with us at any time you want.
Final Document Meeting
We will go through all of your final documents together to ensure the plan is exactly what you want.
Frequently Asked Questions
Why is asset protection important?
Put simply, it takes a long time to build wealth, but it can be lost very quickly, sometimes through one poor decision or mistake. Losing your wealth, particularly when you are in middle or later years, may be impossible to recoup. Protecting your wealth from loss is, therefore, one of the most important things that you can do. It is therefore critical to consult an asset protection lawyer to ensure your wealth is protected for you now and for future generations.
When should I consider putting in place asset protection strategies?
The earlier the better, because actions you take during an impending insolvency are likely to be unravelled. Many strategies involve the transfer of assets out of your name, for example, to a family trust, super fund or ‘safe harbour’ spouse. Under the Bankruptcy Act, the transfer of assets for less than market value (made without an intention to defraud creditors) must be made 4.5 years or more from the date of bankruptcy (this period can be reduced in some circumstances) otherwise it can be ‘clawed back’ and considered as part of your assets to be distributed in a bankruptcy.
Other strategies, such as binding financial agreements between partners, are also best considered at the outset of the relationship, and renewed on significant events occurring, such as the birth of children.
Why could my estate not end up in the hands of my selected beneficiaries?
There are many reasons that beneficiaries in your Will can end up with significantly less, or nothing. One of the main reasons is an estate claim, brought by an eligible applicant after your death that you have not provided for adequately in your Will. Estate claims can be long and hard fought, and easily cost upwards of $300,000. Often such claims are paid for by your estate. If the claim is successful, your beneficiaries not only get less because wealth goes to the claimant, but also because the size of the estate is reduced by the legal fees.
Another more hidden risk is the reduction of the gift due to tax. For example, there is a death benefit tax on superannuation, for example, given to beneficiaries who are not deemed to be death benefit dependants. The concessional component is taxed at a flat 17% and any insurance in the super is taxed at over 30%. Assets that carry a CGT liability do not get CGT rollover relief on death when gifted in your Will to certain beneficiaries (such as foreign beneficiaries or non-tax deductible charities). Tax effective estate planning strategies need to be considered when preparing your Will to minimise these taxes.
What is a gift and loan back strategy?
A ‘gift and loan back’ strategy involves gifting a sum of money to a family trust by way of a deed of gift and then having the family trust loan the money back to you (by way of a deed of loan). Instead of a family trust, you can use a trusted, ‘safe harbour’ person with low business risk, such as a stay at home spouse. This process creates a loan owing by you to the family trust. The trust can call for the loan to be repaid at any time. A gift and loan back strategy can be a potentially useful asset protection strategy for people in high-risk occupations at risk of a legal claim or bankruptcy. Under the Bankruptcy Act, the transfer of assets for less than market value (made without an intention to defraud creditors) must be made 4.5 years or more from the date of bankruptcy (this period can be reduced in some circumstances) otherwise it can be ‘clawed back’ and considered as part of your assets to be distributed in a bankruptcy.
The strategy may also help to protect your estate from any Family Provision Application (FPA) that may be brought against your estate after your death (depending on what state you are living in when you pass away or where your assets are situated at the date of your death).
At Estate First, our experienced team of asset protection lawyers can assist you in implementing a gift and loan back strategy.
"Estate First Lawyers made the process easy to understand and we were able to make our decisions with all the information and alternatives required. Thank you."
"They brought up some points I’d never thought about so I was truly grateful."