As a business owner, there are plenty of things you need to manage, and two of the most important of these are risk and assets.
You need to have strategies in place to both build your wealth and protect your wealth. There’s no point building a lot of wealth if the way you have things structured behind the scenes means that someone could take your assets away from you.
Sadly, many business owners are in precisely this predicament …without knowing it! That’s why businesses have Asset Protection, and why all business owners should address this vital area.
The following are some crucial concepts that, if you as a business owner don’t understand them and don’t put protective measures in place, your family home (and all personal assets of you and your family) are at risk of being lost if someone decided to take legal action against your business.
Consider these facts…
- Your business faces unpredictable risks through interaction with employees, customers/clients and creditors.
- This means there is potential to be sued by a variety of parties. Where there are agreements in place, sometimes disagreements later result. This is life. It makes sense to accept that, and plan and protect yourself, rather than hope it never happens.
- Litigation, is increasing each year, largely driven by lawyers offering ‘no win, no fee’ services.
- This encourages people to ‘have a go at you’ through legal action. They have nothing to lose, after all.
- This means you need to ‘build a wall’ between your business risks and your personal assets otherwise you risk losing it all.
- This ‘wall’ protects you and your family from losing assets such as your house or personal investments, if your business was to be sued.
- The wall is created by clever use of companies, trusts and also deciding who within a married couple, for example, who should and should not be a Director of each company. This is a key point. One seemingly simple mistake in this area can cost a family their house.
Because the business may be in a company, but who owns the shares? The directors? Sue the directors and you get the company and the family home.
So what can you do about it?
If you haven’t looked at your asset protection structure in the past 12 months, you need to make that a priority. Then this should be reviewed annually because as your life changes, your asset protection strategies – your wall – needs to be checked to ensure that it is still appropriate.
It’s all about choices and about ensuring you protect your family and your assets. Without sound asset protection, effective wills and estate planning in place, the legacy you have been working so hard to build, may not end up in the hands of the people you intend.
To make a time to meet and discuss your Asset Protection options, contact us, we can help to provide you with the protection you and your family deserve for years to come.