Protecting YOUR NET WORTH
GOT IT COVERED?
Consider carrying the maximum liability coverage available on your homeowners and automobile insurance policies. You may also want to have umbrella coverage for additional protection should the amount of a claim against you exceed the limit on the underlying home or auto policy. You’ll also need adequate professional liability insurance to protect against malpractice claims if you are an attorney, doctor, engineer, or other practicing professional.
For business and real estate ventures, using an entity that offers some form of limited liability can reduce your personal exposure to the claims of business creditors. Possibilities to consider include a corporation (regular or Subchapter S), a limited liability company (LLC), or a limited partnership.
A standard business owners policy (BOP) combines property, commercial liability, and business interruption insurance. (Separate policies are also available.) A BOP does not include workers’ compensation or auto coverage. If you own a business, review your coverage to make sure there are no gaps.
YOUR NEST EGG
Investing in a 401(k) or other qualified retirement plan is a helpful wealth-protection strategy. Plan assets are generally protected from creditors under ERISA (the federal pension law).
Trusts are often used to help protect assets earmarked for children and grandchildren. Consult an estate planning attorney if you are interested in creating a trust.