The more assets you accumulate and the more diverse your portfolio, the more you are susceptible to risk. It’s no secret that the United States is a highly litigious country, which can ultimately present a problem the higher a person’s net worth grows over time. Wealth solution firms such as Ora Partners Limited or Fidelity provide services that help you protect your wealth.
As your net worth increases, there tend to be more things to monitor. For instance, a person’s business or vacation rental home, often seen as a means to make money, can also present risks to the owner if they aren’t properly protected. A customer could sue over injuries suffered at a vacation home or expose the owners to liability.
How can you protect your assets in such a risky and complicated world? Completely avoiding litigation may be difficult, but it’s possible to place your assets beyond the reach of lawsuits through a strong wealth protection plan that incorporates an offshore trust.
How to Protect Your Assets from Litigation
A strong asset protection plan often depends on your risk tolerance, net worth, and the likelihood of you getting sued. The good news is that there are numerous tools available to form an asset protection strategy that can help protect your assets from litigation and creditors.
Insurance is not always thought of as an asset protection strategy, but it really is, as it accomplishes this by transferring risk from the policyholder to the insurer. Purchasing insurance increases the chances that assets will be recovered after a loss.
Offshore limited liability corporations (LLCs) are another asset protection vehicle specifically used by business owners. Aside from offering the business entity a higher level of protection from U.S. court judgments, offshore LLCs can ensure privacy and separate assets from those of the business.
Then there are Cook Islands trusts. This type of asset protection offers a level of security that the other vehicles do not. Cook Islands trusts protect a wide range of assets, including real estate, cash, stocks, and cryptocurrency. This option also exists outside the scope of U.S. courts.
How to Protect Your Assets from Bank Failures
Recent bank failures show that even financial institutions long seen as healthy can be vulnerable to bank runs if loans and deposits are not managed responsibly. Having all your eggs in a single basket can threaten your financial future.
Another way to protect assets is to choose an offshore banking system with a long history of stability. Switzerland is a country with a long-term track record of banking and asset protection. Switzerland has its own version of the FDIC that insures most deposits. Swiss bank accounts can also be opened through offshore trusts, such as a Cook Islands trust.