Marrieds Should Say “I Do” to Asset Protection

5:38 pm Asset Protection, California Trusts, Domestic Asset Protection

asset protection 150x150 Marrieds Should Say “I Do” to Asset ProtectionThere are three primary reasons that married couples should consider asset protection as part of their financial planning strategy:  to provide for each other and minor children in case one spouse dies, to protect assets from lawsuits or creditors, and for each to be protected in the event of a divorce.

Since California is a community property state, this means that all assets accumulated during the marriage are viewed as community property – which also means that creditors can access those assets, even if it was just one spouse that incurred the debt.

Spouses can use what is known as a transmutation agreement to convert assets from community property to separate property, but it must be handled carefully and with all proper legal protections in place, since the law of fraudulent transfers does apply to transmutation agreements.  You should also consult with a California asset protection attorney since there may be tax consequences that come into play as well.

Spouses may elect to fund a trust with community property assets, which can be an effective form of asset protection from creditors.  Families may wish to place assets in trust to protect property against divorce, with provisions that allow for only blood relatives to manage trust assets.

If you are interested in learning more about marital asset protection, contact our Newport Beach asset protection law firm.

Contact us today for individualized planning strategies to meet your unique needs.

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