While some have entered the in the medical or business field with dreams of making millions, most physicians have spent years in school, training and practice with the goal of helping others foremost in their minds. Most physicians give 110% to their jobs, and are always working to know more and to do more to improve the lives of their patients.
But regardless of the quality of the treatment you provide, there’s always the chance – especially in today’s litigious society – that you’ll find yourself entangled in a lawsuit. You have to take protective measures as far in advance as possible for your asset protection, because the best time to solve a problem is before you have it.
And the most crucial step you can take is to transfer assets to places where they may be legally protected from court judgments for asset protection for physicians and business owners. Those include:
Trusts are excellent way to protect your personal assets. When you transfer assets to an irrevocable trust that you’ve created, you no longer own the assets – the trust does. Since your assets are then held outside of your estate, they’re less accessible to judgments.
In the simplest terms, an annuity is a contract between you and an insurance company. You agree to make a series of payments (or even a single, “lump sum” payment) to the insurance company, and the insurer agrees to make regular payments to beginning at some date in the future. While the annuity itself can offer some protection against creditors, the income stream the annuity produces may offer an even greater degree of insulation.
While policy holders can access the cash value in a life insurance policy like whole life policy, civil judgments are typically impeded from doing so, primarily because doing so would mean an economic hardship to the beneficiaries. The greater the contribution to the policy, the more money that can be accessed or left to beneficiaries in the future. Obviously, it’s best to wait to access a policy’s cash value, at least until after retirement, when the risk of potential malpractice lawsuits has long subsided.
Because retirement savings inside defined benefit pension plans and profit sharing plan are protected under the Employee Retirement Income Security Act of 1974 (ERISA), assets in the plans have proven far less vulnerable to judgments than money contained in IRAs, Simplified Employee Pensions (SEPs), defined contribution and defined benefit plans.
Contrary to what’s true for most people, one of the smartest things you can do it not pay off his or her mortgage. Since courts can only take possession of the things that you own, living in a home that you’re still paying for may be the best way of protecting it in the event of a malpractice suit.
Asset protection strategies are complex and require the advice of specialized professionals like asset protection/estate planning attorney and knowledgeable financial professional. For more information on protecting your assets in the event of a malpractice suite or any other lawsuits , BeamaLife has a team of professionals and can help you to protect you assets. Please call (877) 972-3262 to speak with one of our specialists or complete the consultation request form now.