Cortburg Speaks Retirement

Estate Planning and Asset Protection

• Miguel Gonzalez, MBA, AIF®, CPFA®, CRC® • Season 2023 • Episode 154

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Cortburg Speaks Retirement - episode #154: Estate Planning and Asset Protection Are They The Same / Investment in Stock Market, Financial Planning, Retirement Planning, Money Management 

In this week's audio podcast, Miguel Gonzalez explains the key differences between estate planning and asset protection, as well as the optimal occasions when you should consider each wealth-preservation strategy.

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with Miguel Gonzalez, MBA, AIF®, CPFA®, CRC®

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INTRODUCTION

Welcome to Cortburg Speaks Retirement

An audio podcast about investing in the stock market, financial planning, money management and retirement planning.  Each Wednesday, we help investors at all stages of life learn how to potentially grow and preserve their money from first job through retirement.

Now here is your host, Miguel Gonzalez.

 

HOST

Good morning and welcome to the CORTBURG SPEAKS RETIREMENT audio podcast.   

On this week’s audio podcast, I discuss the key differences between estate planning and asset protection.

Estate Planning and Asset Protection: Are They The Same?  

You may sometimes hear the terms "estate planning" and "asset protection" used interchangeably. They actually have different meanings, and it's important to incorporate both strategies into future financial plans. Below, we discuss key differences between estate planning and asset protection, as well as the optimal occasions when you should consider each wealth-preservation strategy.

Estate Planning: Focused on the Future

Estate planning largely focuses on what happens to your assets after you die. An estate plan can include some or all of the following documents:

●     Last will and testament

●     Trusts

●     Guardianship documents for minor children or other dependents

●     Powers of attorney

Properly executed, these documents can ensure that the deceased person's (or "testator") wishes are carried out seamlessly.

Asset Protection: Focused on the Present

Asset protection strategies are proactive and focused on the present. They protect assets from being seized or dissipated by others during their lifetime. Common asset-protection strategies include:

●     Pre-nuptial agreements

●     Post-nuptial agreements

●     Trusts

Asset protection strategies can be implemented immediately. For example, assets placed in irrevocable trusts belong to the trust, not the person who contributed them. This means if you or your business are ever sued, these trust assets aren't available for seizure or attachment even if you're ultimately liable for the judgment. Keeping assets in a trust can also help you qualify for Medicaid if you don't have enough funds for long-term care or would like to retain assets to pass to your heirs.

When Do You Need Estate Planning and Asset Protection?

Ideally, estate planning and asset protection can find ways to work together. You may even include an asset protection plan as part of your ultimate estate plan. However, there are some timing factors to consider.

First of all, engaging in asset protection strategies after your assets are at issue can backfire. For example, if you don't have a prenuptial agreement and begin to set aside assets only after your spouse has filed for divorce, it's likely that a judge will consider this an improper attempt to hide or dissipate marital assets. Similarly, if you're interested in qualifying for Medicaid and then sign over your home to your spouse or child, you'll be subject to a "look back" period; you won't be able to qualify for Medicaid until after this period has expired. Finally, if you begin giving away assets to loved ones after a legal judgment has been entered against you, your creditors may be able to come after your loved ones for these assets instead.

This means there's no better time than the present to create an asset protection plan. Once this plan is in place, you can work on your estate plan, which is generally less time-sensitive.

Although there is some overlap in asset protection and estate planning strategies, the focus of each approach is very different. By considering both these strategies and putting them into place as soon as possible, you may help protect your wealth both now and in the future.

 

Make sure to visit our website, www.CortburgRetirement.com. Our site is filled with educational videos, eBooks, publications, and financial calculators designed to help you learn more about your finances.  As you search our site, send us a note regarding any questions you may have about any particular investment concepts or products. We will get back to you quickly with a thoughtful answer.

This is Miguel Gonzalez, Certified Retirement Counselor (CRC) and Managing Partner, with Cortburg Retirement Advisors signing off for this week’s educational podcast.  

 

DISCLOSURES  

Opinions expressed are subject to change without notice and are not intended as investment advice or a solicitation for the purchase or sale of any security. Please consult your financial professional before making any investment decision. 

All performance referenced is historical and is no guarantee of future results. All indices are unmanaged and may not be invested into directly.

This information is not intended to be a substitute for specific individualized tax advice. We suggest that you discuss your specific tax issues with a qualified tax advisor.

CRC conferred by The International Foundation for Retirement Education.

Securities offered through LPL Financial. Member FINRA/SIPC. Investment advice offered through Private Advisor Group, LLC, a registered investment advisor.  

Private Advisor Group, LLC and Cortburg Retirement Advisors, Inc. are separate entities from LPL Financial.

Investing involves risk including possible loss of principal.

·         The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual.

·         This information is not intended to be a substitute for individualized legal advice. Please consult your legal advisor regarding your specific situation.

·         LPL Financial Representatives offer access to Trust Services through The Private Trust Company N.A., an affiliate of LPL Financial.

·         This article was prepared by WriterAccess.

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Miguel Gonzalez, MBA, AIF®, CPFA®, PPC®, CRC®

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