Asset Protection Strategies and Entities

One of the things we notice when working with clients for years or decades is that their priorities change when confronted with their mortality. Thoughts about the security of their families, or the charitable causes that matter most start to take center stage for the assets that may not be utilized during life. The problem however, usually comes down to one thing that affects much of financial planning: timing.

Our team of experienced advisors will help you define your wishes and draft a plan before it is too late. We use a variety of estate planning techniques centered on tax efficiency and cost effectiveness to help you distribute estate assets on your terms.

Basic Forms of Asset Protection

  • Insurance Policies & Annuities
  • Home Equity
  • Retirement Accounts

Intermediate Complexity Level of Asset Protection

  • Lifetime and Post-Death Gifts
  • Education gifts (e.g., Section 529 plans)
  • Spendthrift Trusts

Complex Forms of Asset Protection

  • Business Structures
  • Pass-through entities (e.g., limited partnerships & Family Limited Partnerships)
  • Protective trusts including domestic asset protection trusts and off-shore trusts

Life Based Risk Analysis


Our business model relies on maintaining the value and success of our client’s financial plan. This is why risk assessment is part of almost every conversation we have with individuals and families we’ve partnered with. As you accumulate more throughout your earning phases of life, you have more to lose – a fairly simple concept. However, as more time elapses, it is actuarially more expensive to manage risk. That obvious fact is why it is very important we take an independent approach in seeking out the best policy, or contract that best suits the individualized goals and plan at hand.

Contract Structures

There are multiple types of common life insurance policies and hundreds of different versions of riders that carriers use to differentiate their products. This is why it is not only important to shop the market, but that the advisor understands the application of different policy types to educate clients on what may be appropriate for your family, retirement or/and estate plan.

Self-Insurance Analysis

The self-insurance conversation starts with identifying what assets are protected and what assets are at risk. These are particular to the type of asset and may be dependent on the state provisions in which you domicile. The next step is to perform a cost-benefit analysis and assign probabilities to potential outcomes; an often imperfect trial and error process but is the framework necessary in coming to a prudent and informed decision. Finally, and often the deciding factors, are the non-financial concerns such as client emotions, timing, stress triggers, peace of mind and realms of uncertainty.

Life & Disability Insurance Policies

Term Life Insurance

Offered in durations of 10 – 30 years, these policies are extremely effective ways of insuring your family while in the accumulation stages of life. Due to the fact that less than 2% of these policies actually pay out, they are often very affordable.

  • Pros: Usually the cheapest way of insuring your loved ones. Sometimes convertible when term comes to an end.
  • Cons: Not permanent. Outliving your policy often means no insurance benefit received.

Whole Life Insurance

A permanent life insurance policy that will last the full length of your life as long as you fulfill your level annual premium obligation. This policy has a cash value with a guaranteed rate of return and the death benefit will never change.

  • Pros: Permanent life insurance vehicle that has an investment element. Cash values are accessible in the case of an unforeseeable event.
  • Cons: Typically more expensive than many alternatives. Can also have significant opportunity cost over long periods of time with lower rates of return.

Universal Life Insurance

Guaranteed Universal is a type of permanent insurance with little or no cash value with a level premium. These policies are often “paid-up” in lump sums, or paid for over a shorter period of time.


Often cheaper to purchase over other forms of permanent life insurance.


No accessible cash value and missed premiums can result in policy forfeiture

Indexed Universal Life is permanent insurance that uses an investment portion which tracks an underlying market index. Your cash value can have significant appreciation potential depending on the chosen asset mix and the premiums are flexible to an extent without risking contract collapse.


Permanent product with access to cash value, flexible premiums, and market appreciation.


Indexed products contain caps on earnings. These caps can be monthly, quarterly, or annual and can translate into significant opportunity cost over time.

Variable Life and Variable Universal Life Insurance is a permanent product that has a similar structure as indexed universal life except the cash value is invested in mutual funds and bond funds. Whereas Variable Universal has flexible premiums, Variable Life does not. Premiums and death benefits are fixed with both of these contracts.


Permanent product with accessible cash value and significant potential for appreciation.


Although there are no caps on earnings, potentially higher fees and investment expenses are taken out of the cash value. There are limited investment options and they often require a hands-on management approach.

Simplified Issue Life Insurance

Simplified issue life insurance is typically term and will allow underwriting without any paramedical exam. There is usually a questionnaire that will enable the insurance company whether or not to make an offer. These insurance policies are usually only available with death benefits fewer than one million dollars and have the same pros and cons as traditional term insurance.

Group Life Insurance

A type of policy that is offered by employers as an employee benefit. These policies range in structure and coverage levels, but due to tax benefits, they are typically limited to $50,000 a death benefit. For an additional charge, employees often have the option to purchase more supplemental coverage if desired. Because of the additional out of pocket expense, these should often be compared to third party options.

Short Term Disability

Depending on the policy, short term disability is typically for benefit periods of 3-6 months. Common claims for disability are things like injury, pregnancy, mental health and cancer. You often can have the majority of your earned income paid directly to you with no restriction on expenses.

Long Term Disability

Long term disability can provide a vital benefit for those who may be at risk of losing an income they need to survive financially. These benefits are typically 40-70% of your income, can be purchased with different elimination periods, and for durations usually stated in years – some will pay until retirement. Medical professionals with hundreds of thousands of dollars in student loan debt or people in high risk industries should all have a cost-to-benefit analysis done on purchasing one of these policies.

Asset Based Risk Analysis

Protected Assets

  • Real Estate
  • Insurance
  • Qualified Retirement Accounts
  • College Savings Accounts
  • Trust assets, Corporate Assets and Partnership Assets

Vulnerable Assets

  • Any assets transferred to protected structures/entities within certain look back periods or statute of limitations. (lookbacks and rules applicable on a state by state basis)
  • IRA rollover and Roth IRA assets above $1.25m
  • Real estate and other large assets (aircraft, autos, etc.) not owned by entities
  • JTWROS & TIC account assets
  • Second Homes and Vacation Homes
  • Individually owned assets

The list of vulnerable assets is usually larger than the list of protected assets. Even with the assets that are protected, there can be limitations and variations that may or may not be applicable based on a number of factors. It is important that every situation be analyzed on a case by case basis. If you have any of these assets listed above, there could be vulnerabilities you could be assessing, mitigating, or eliminating all together.

Let's Help You Prepare for the Future

If you just want to talk and cut through the fog of financial advice, we would be happy to explain how it all works along with helping you develop a road map to reach your goals.