Asset Protection & Risk Management

As a business owner, your business and personal assets are vulnerable to risks such as external creditor attack and frivolous lawsuits.

MJM Financial Advisors, LLC believes a comprehensive asset protection plan can insulate your assets from risks such as:

  • Foreclosure actions brought by your business' secured lender
  • Lawsuit for breach of contract
  • Divorce action where no pre-nuptial agreement has been drawn
  • Suit based on an intentional act by a domestic or business employee
  • Your personal guarantee as a business owner of a non-business secured debt
  • Personal creditor attaching a shareholder's corporate stock in any and all of the owner's corporate businesses to satisfy a judgment
  • Employee to employee harassment or personal injury
  • Suit brought by a child's actions (car accident, vandalism, etc.)

Sound asset protection requires striking a balance. It shouldn’t be so simple that it leaves you unprotected. Nor should it be so complex that it causes needless difficulty, confusion and worry.  It should also be tax-neutral, so you can preserve your wealth without a negative impact on your taxes.

Your planner must have a broad knowledge of all reasonable asset protection options–from the simplest to the most complex.  At its most basic level, asset protection involves transferring assets from an unprotected form of ownership to a protected form. Unprotected assets generally refer to property held directly in an individual’s name or in the name of a revocable living trust. Protected assets can reside in separate legal entities that may be exempt. Your planner must be familiar with both federal and state regulations.

Our Approach to Asset Protection and Risk Management

At MJM, we go beyond basic asset protection to consider broader issues of risk management. We assess three areas of asset protection and risk management.

  1. Overall Risk Threat Audit. We help you understand how you may lose both personal and business assets to various legal actions. We also offer a full array of risk management services including advice regarding privacy and physical security issues. We review insurance coverage for your home(s), vehicles, health benefits, disability, life, long-term care, and any other risk you may have. We perform a trade-off analysis, analyze current coverage levels, policy limitations, and cost competitiveness. This may involve obtaining second opinions to ensure you are afforded the best solutions. Then we develop an optimal, coordinated risk plan and supervise its implementation. Finally, we continue to assess risk management needs as part of your ongoing wealth management requirements.
  2. Business Entity Audit.If youown closely-held or family-owned businesses, we consult with you on proactive strategies when initially structuring and funding business ventures, depending on whether they are operating entitles or those holding real estate. Direction on choosing the proper form of entity, jurisdiction, instituting the observance of proper entity formality, and how to correct current entity structures are included. Both multi-member and Series Limited Liability Companies (LLC), corporations and various types of trusts may be utilized. Both domestic and certain offshore jurisdictions may also be considered in light of special circumstances.
  3. Business Operations Risk Audit. We focus on the many risks inherent in operating a business and how to minimize or limit your exposure to those risks.  Employees, vendors, clients, visitors, and materials and products in your business may encumber you with unintended liabilities. Proper analysis and coverage of associated risks, from both inside and outside the business, is essential. Business owners need to consider and cover commercial property, business income, general liability, and umbrella coverage issues. We develop an action plan to address issues across a broad set of risks both apparent and potential in nature.

An overall asset protection plan may be doomed to failure if you don’t fully comprehend the plan and assist in updating it as soon as risks change. That is why we educate and update you on your risks and propose appropriate change. We also work with your insurance advisors, or specialized consultants as the situation dictates, to help you identify and implement the best protection strategies available for your situation.

Please contact us to learn more about how we can assist in your wealth management needs.