Like most people, you don’t know what your assets are. You may think they’re just the money in your bank account or the house on the corner of Elm and Maple, but those aren’t even close to being all of them. We can say that any resource that has value to us is an asset. So, if you want to protect your assets, you need to take a closer look at what they are and how best to keep them safe.
Protecting your assets is something everyone needs to do, even if you’re not rich! After all, it doesn’t matter how much money you have if you don’t have any coming in. Here are some things we all ought to be doing to keep our assets safe:
Have a will and estate plan in place
One of the most important things you can do to protect your assets is to have a will and estate plan in place. This document will spell out exactly what should happen to your assets after you die. It can also help to avoid any confusion or conflict among your loved ones after you’re gone.
If you don’t have a will or estate plan, your assets will be distributed according to your state’s laws of intestate succession. This means that your assets will go to your closest relatives, regardless of whether or not you actually want them to have them.
Make sure you update your will and estate plan regularly, especially if you experience any major life changes (like getting married, having children, or buying a new property).
Keep good records
Another important way to protect your assets is to keep good records. This means keeping track of all your important financial documents, like bank statements, tax returns, and insurance policies.
You should also keep records of any physical assets you have, like jewelry, art, or vehicles. Make sure these records are stored in a safe place, like a fireproof safe or a safety deposit box.
It’s also a good idea to keep digital copies of your records in case the physical copies are lost or damaged. You can store these electronically on an external hard drive, in the cloud, or on a USB drive.
Have adequate insurance
One of the best ways to protect your assets is to have adequate insurance. This will help to cover any damages or losses you experience up to the limits of your policy.
Make sure you’re properly insured against fire, theft, and other risks. You may also want to consider umbrella insurance or excess liability insurance to further protect your assets.
Keep your assets diversified
Another good way to protect your assets is to keep them diversified. This means not putting all your eggs in one basket, so to speak.
For example, don’t invest all your money in just one stock or real estate property. Instead, spread your investments out among different asset classes, like stocks, bonds, and cash.
This will help to reduce your risk of loss if one particular investment goes bad.
Have an emergency fund
Another important way to protect your assets is to have an emergency fund. This is a savings account that you can tap into in case of unexpected expenses, like a job loss or major medical bills.
Your emergency fund should have enough money to cover your living expenses for at least three to six months. This will help to make sure you’re able to keep up with your financial obligations even if you experience a temporary setback.
Protect yourself and your assets legally
One of the best ways to protect your assets is to make sure you’re doing everything legally. This means having up-to-date wills and estate plans, keeping good records, and having adequate insurance.
You should also make sure you’re aware of your state’s laws governing asset protection. Each state has its own laws, and they can vary significantly.
If you own real estate, for example, you’ll want to make sure you understand your state’s laws regarding homesteads and other types of real estate protections.
You should also consult with an attorney who specializes in asset protection. They can help you create a comprehensive plan to protect your assets and make sure everything is done legally.
Conclusion
There are many things people can do to protect their assets, from making a will to having adequate insurance. By following these tips, you can help ensure that your assets stay safe and out of the hands of creditors or litigators. If you’re not sure where to start, consult with an attorney who specializes in asset protection. They can help you create a customized plan to protect your specific assets.