Protecting Assets

[JHZR2]

This isnt related to me, and more or less a theoretical question, but something Ive been curious about for some time.

Say you and your spouse if applicable are not business owners, but for one reason or another are in positions where there is a potential of being sued for one reason or another.

Say youre reasonably well off... i.e. you own a home or two, a few cars, have retirement and other savings/investments, etc.

What is the best method to protect yourself and spouse from losing your home in the case of a lawsuit? What is the best way to protect your other assets?

Thanks for the insight!

JMH

 

[michaelc80]

We are close to that category-we have a home in the country and some land, along with a lot of equipment and 3-4 cars. Retirement as well. We decided a long time ago it was well worth it to take out an umbrella insurance policy for $1 million. It only costs about $200 per year but in my opinion is well worth it.

Won't cover me if I do something insanely stupid, but if someone come on the property and falls it picks up where our other homeowners insurance leaves off.

 

[Master ACiD]

i think if you homestead the house you own then it can not get taken away.

this is what i just did the other day to the house i bought 2 months ago.

 

[JHZR2]

what does honesteading mean?

I was under the impression that the rich, etc put their stuff into trusts or some similar thing to protec themselves?

JMH

 

[Beachboy]

You don't have to be rich to establish a trust, a lot of folks are doing it nowadays. Both my Dad and my Mom established separate trusts. Biggest advantage of a trust is that it avoids probate upon the death of the owner. I don't know about the legal ramifications concerning liability issues. Myself, I have purchased a million dollar umbrella policy through my regular insurance provider. It costs me just $65 annually, which cheap protection from a lawsuit-crazy world. Sometimes I wonder if I should raise it to 2 million, which is the most my insurance company will write on individuals.

 

[Steve128]

Hum, my daughter may need an neurological operation for a potential brain tumor; so I will ask members of BITOG for advise.

Sound like a well thought out plan?

Maybe talking with an estate lawyer would be a good idea.

Then again, it's your money. Wait, it is not your money, it is a "theoretical question". Kind of like a friend of mine, or someone I know, or my cousin...etc.

My bad.

Feel the love!

 

[Al]

Quote by Beachboy: "It costs me just $65 annually"
What insurance do you have..mine went up to $300 + and I dropped it. I bought 2 million in liability auto insurance..but that's not an umbrella policy. I have Allstate.

Great topic. I am interested in answers. One thing that's obvious is that if a vehicle is in a single name..joint accounts can't be attacked (in theory). But they still can attack things like wages..not sure about Social Security...That's a question from me.

I think that you need an Irrevocable Trust to protect your assets..but that's expensive and duuuuuuhhhh its irrevocable and you lose control.

My thgought is to set up an Irrevocable Trust in the event that something bad becomes imminent. The question is; would this work?

Hope this becomes a good discussion. Lots of smart people here.

 

[Al]

Quote by Steve128 : "Hum, my daughter may need an neurological operation for a potential brain tumor; so I will ask members of BITOG for advise.

Sound like a well thought out plan?

Maybe talking with an estate lawyer would be a good idea.

Then again, it's your money. Wait, it is not your money, it is a "theoretical question". Kind of like a friend of mine, or someone I know, or my cousin...etc."

U should end yourself

uncalled for.

 

[Steve128]

Jeez, Al, why not chill? Life is too short.

You left out my last two lines in your quote of mine which shows I was jacking with JHZR2.

Merry Christmas!

 

[Beachboy]

Al, I have my umbrella policy through State Farm, who also has my house and two cars. For the cars, before they issued the unbrella policy, they required me to up the liability on both vehicles to the max. Can't remember what those limits are, I'm at work and my policies are at home. It was something I should have done anyway, since vehicle replacement coverage of $25,000 wasn't adequate anymore. As I recall, raising the liability limits on the cars didn't add very much to the premiums either. I have a '99 Mercury and a '97 Explorer, and pay less than $250 every six months for each one. Full coverage, $250 deductible.

 

[Al]

OK beachboy..I did the same with AllState but the liability was waaaay more. Think I'll need to start looking around at a different insurance company.

BTW I did apologize to Steve for my remark

 

[JHZR2]

Al... youre in PA, Beachboy is in KS.

Did you watch FOX Phila news the other night, talking about how poor the Phila area drivers are (being from NORTH NJ I have to agree)? I dont know if you get phila news or not... but harrisburg news may be the same stuff.

As a result, everything is more expensive for us when it comes to insurance... I dont see that much relief, even from changing companies...

JMH