Many residents of the Cincinnati area and the surrounding Southern Ohio communities may not think much about protecting their legacy from creditors. After all, people who are seriously thinking about how they are going to leave their property to their loved ones are frequently at a stage in life where they have little or no debt.
Of course, people cannot predict what their future holds. They may be financially secure at the moment they are doing their estate plans. However, an unexpected medical emergency, business failure, tax audit or other financial emergency can quickly land a person in debt.
On a related point, a person has to think about their ongoing tax obligations, as well as the fact that as they age, they are more and more likely to require expensive medical care.
Likewise, especially in modern American society, there is always a chance a person can be sued. Business partners and even one’s own family members might take a person to court. If a person is married, divorce is always a possibility.
The debts of loved ones
A person doing estate planning should also be sure to think about if their loved ones either have creditors or may have them in the future.
To give a couple of examples, a person might have a child whom they know is not financially responsible. A child may be in an unstable marriage, and the person might be concerned with what will happen in the event of a divorce.
There are techniques Ohio residents can use to make sure their property goes to their loved ones and not their loved ones’ creditors. For example, they may create a spendthrift trust which prohibits an heir from using their share of the trust to secure a loan.
Asset protection is an important component of many if not most estate plans. A person should speak to an experienced estate planning attorney about their options regarding asset protection.