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Coordination of Estate Planning and Asset Protection

Maximizing the Financial Security for the Total Family Unit

A coordinated asset protection and es­tate plan has become a necessity for en­trepreneurs and other businessmen, medical and other professionals. There is almost universal acceptance of the need for estate planning to minimize taxes and provide how property is dis­tributed after death. The idea of safe­ guarding assets during one’s lifetime is not a new idea either, but it has only recently come to the forefront for sev­eral reasons.

  1. There has been an explosion of new variations on existing theories of legal liability available to our customers, clients and patients.
  2. There has been an escalation of the amounts juries are willing to award, and
  3. Because there is more money involved, more lawyers are willing to pursue these theories of liability on a contingent fee basis.

Taken in concert, these three factors have fueled an explo­sion of litigation with sometimes devas­tating and disastrous results. Over 30 million lawsuits were filed in the United States in 2003; many of them may have been without merit.

Asset protection planning is a well ­recognized practice area of the law. Several years ago the Real Property, Probate and Trust Section of the Ameri­can Bar Association created an Asset Protection Subcommittee. Within the last 10 years, almost 4 states and 20 countries have passed some form of as­set protection trust legislation. In the recent past, asset protection planning was often done without any regard to a person’s overall estate plan. Similarly, many estate planners did not incorpo­rate asset protection planning into their recommendations. As wealth preserva­tion planning has evolved, it has be­come recognized that asset and estate planning are not only compatible, but that they should be done as one process. Asset protection planning should be considered as your lifetime asset preser­vation plan and estate planning should be used to mitigate taxes at your death and provide a vehicle to transfer prop­erty according to your specific wishes. Very few planners open this discussion, let alone understand available sophisticated strategies and techniques that completely coordinate with the clients overall, yet specific, financial objectives.

We believe a proactive and forward thinking planning consultant finds the subject necessary and therefore promotes to integrate the two disciplines of asset protection and estate planning into one process. This is our philosophy.

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