Planning ahead is the best way to protect your family and yourself. Uncertain times can bring unforeseen hardships that require serious thought and choices regarding your estate plan. Even the best plans can be crushed due to economic uncertainties such as market instability and recessions. The country has experienced too many disruptions to even count in recent years, and it’s important to do everything you can to ensure that your estate plan is as strong as possible. You can protect your assets and provide for your family in several ways, even when you are gone. This article will explain a few of the best strategies to add a level of protection to your estate plan during times of uncertainty.
Protect Your Assets
Protecting your assets during uncertain economic times should be one of your top priorities. No single plan can guarantee that your assets are fully protected, so working with an attorney who can craft a personalized asset protection estate plan is important. Here are a few strategies that can help protect your assets and wealth:
Build an Emergency Fund
Starting and building an emergency fund is important, especially during uncertain economic times. No one is able to predict the future, but you can always count on financial issues popping up when you least expect them. Vehicles break down, and you could lose your job or even experience an expensive medical emergency. An emergency fund can bail you out of a challenging situation and will help protect you from dipping into your long-term investments or selling assets to make ends meet. You want to save enough money in your emergency fund to cover your bills while you get back on your feet should you ever experience a financial emergency.
Establish a Trust
There are two main types of trusts that you can utilize to protect your assets: irrevocable and revocable. Each type operates differently, and the choice between the two depends on your needs and goals. An experienced estate planning attorney can guide you through the process and help you choose the best fit for your needs.
An irrevocable trust can shield your assets from creditors and lawsuits. You relinquish control of the assets placed into an irrevocable trust, which may lower your tax liability and give you additional asset protection.
A revocable or living trust allows you to retain control of your wealth and assets. While this type of trust may not give your assets the same level of protection as an irrevocable trust, they are still a great tool to use for those who want to maintain control of their assets. Trusts typically allow assets to avoid probate, saving your estate time and money.
Review Your Existing Plan
Reviewing and reevaluating your existing estate plan is key to fully understanding any weaknesses it may have. Unsavory market conditions and economic uncertainty can change how your estate plan operates. Your income and life situations may adapt, which can prompt a review of your plan. Here are a few steps you can take to strengthen your estate plan:
Update Your Legal Documents
You should review and update your legal documents regularly, but even more so during economic uncertainty. It’s important to ensure that they reflect your current goals and are not outdated. You should also review your beneficiary designations on all accounts to ensure accuracy. People change, and you want to ensure your assets go to the people you desire.
Review Asset Diversification
Asset allocation and diversification depend on your retirement horizon, age, goals, and risk tolerance. Diversifying your assets can reduce your market exposure and protect you from economic uncertainty. Speaking with a professional is important to ensure you reach your financial objectives.
How An Attorney Can Assist
Estate planning attorneys have experience developing estate plans that can protect you and your family during uncertain economic times. It’s easy to make mistakes when planning for your future, and you don’t want to tackle this task on your own. An attorney can serve as a guide and help you identify and alleviate any potential threats to your estate and your loved ones’ financial futures. They can also help you update your will, and beneficiary designations and lower your tax exposure. An estate planning attorney can also ease any family disputes before they get out of hand and require court intervention.
Contact an Attorney
Progeny Law Firm assists clients with estate planning in Baton Rouge, LA. Call (225) 465-1090 or contact us online for a free consultation.
- Estate Planning for Aging Parents: A Guide for Caregivers - December 5, 2023
- The Seedier Side of the Holiday Season - December 1, 2023
- Protecting Your Loved One’s Assets: A Caregiver’s Guide to Medicaid Planning - November 28, 2023