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Everyone, single or married, should have an estate plan or life plan. As part of our plan, we should always consider our loved ones and our future. Each day we are impacted by numerous events, some fortunate, some not. Asset protection planning is something that should be considered, as we may work very hard to provide for our loved ones but have the things we work hard for taken away through improper planning. I see retirees and business owners, including physicians, and executives, and it is so very easy for them in their busy day to day life to forget to plan. These are some common mistakes made by everyone that can be avoided with proper planning..
- Insurance gaps or deficits – Make sure you have your insurance coverage reviewed at least annually to prevent gaps as these will eventually present significant liability. This pertains to all insurance including business, professional liability, auto, home, etc.
- Failure to have a financially solvent state-registered malpractice insurance carrier and appropriate insurance coverage – Your choice of carrier, especially one not approved by the state of Florida, can place you at unnecessary exposure to risk.
- Failure to procure permanent continuing coverage or proper retroactive coverage when changing carriers – With professional liability you must ensure continuing coverage, especially for health care professionals, You must communicate any incident to both your current and previous carrier to ensure continuing coverage.
- Failure to keep assets out of a high-risk individual’s individual name – Placing assets in the high risk individuals name is not a good idea. Seek assistance of an attorney for proper asset protection planning. Be careful when purchasing buildings, and other real estate and seek legal advice before any purchase.
- Confusion over proper titling of assets – Titling of assets and the structuring of any deal is very important. In Florida, tenancy by the entirety’s may protect the spouses in certain but not all cases. Joint ownership does not..
- Purchasing the wrong investments – Based on your needs, certain assets may be a good idea and others not. Beware of the advisor who makes a commission from your business. Always consult with other professionals such as your CPA, and your lawyer before purchase.
- Failure to ensure protection of business assets – Assets owned by any business are subject to the creditors of that business. Always contact a qualified tax and legal advisors to help you structure the best strategy to protect those assets from business creditors.
- Failure to consider all aspects of estate planning – Beneficiary designations, bypass trust, family trust and homestead planning must all be properly structured and coordinated to minimize exposure to risk.
- Failure to get proper individualized advice from a competent Florida lawyer and tax advisor –There are so many people providing seminars and providing information to others in order to sell their products and services. This general information or misinformation must be discussed with your legal advisor and tax professional as generalized advice or information given by non-specialists or intended for a mass audience can cause significant damage instead of providing the protection that should be in place.