Any major life change throws your family’s assets into chaos; you’ll need certain documents and legal tools to manage your personal family matters. In this post, we’ll show you how to keep your assets and estate safe in the long term and why it matters
Why Protecting Your Assets Is Important
Anything that affects your family assets can have a serious impact on you and your loved ones. For example, you may lose your savings to creditors, or estate taxes could limit how much your family receives from your will.
Anything from death to divorce to a major job loss could derail your or your family’s assets. Even a serious business problem (such as a lawsuit) can leave you liable unless you form an LLC.
Working to protect these assets will help ensure your family’s financial stability. These may even form the basis of a vital safety net - and with the economy shifting by the day, you can never be too careful. For example, an unexpected medical crisis could really eat into your savings.
You also need to protect your loved ones’ assets from estate issues. After they pass, there may still be questions about where their property and holdings should go. A comprehensive will could be the only surefire defense here.
Planning a Family’s Estate
To expand, it’s essential that the whole family has individual estate plans in order. Tragedy could strike at any time, even if they’re in perfect health or relatively young. Estates without a thorough plan are subject to probate, meaning lengthy deliberations over where their assets will go.
Here are a few documents and legal structures that can help you - or someone else - set up an estate:
- A power of attorney: These let somebody you trust make financial or medical decisions on your behalf. If you’re incapacitated, they can manage your assets and estate.
- A last will & testament: These outline how you’ll spread your inheritance. You’ll need to pick an executor whom you trust to fight for everything you put in the document.
- An advanced healthcare directive: This sets out which treatments you would prefer (or prefer not to) receive, letting you veto expensive ones that’ll harm your finances.
- Irrevocable trusts: These trusts let you put money away that creditors cannot take and always avoid probate - but it’s also next to impossible to change their contents.
You can use online templates to set these documents up more easily. These already include the relevant fields, including space for signatures and notarization if applicable, meaning they’ll hold up in court without issue.
Setting up Pre/Postnuptial Agreements
Divorce usually involves the couple splitting their assets. The exact method here varies by state; nine follow “community property” and distribute everything 50/50, while the others use equitable distribution to spread assets fairly according to various factors.
A prenuptial agreement circumvents these rules by clarifying each party’s assets in the event of a divorce. Couples fill these in before getting married - but postnuptial agreements also exist. It’s also possible to switch from a prenuptial to a postnuptial agreement after a major life change.
These arrangements outline how to split joint property, who’ll take control of the family business, and more. You could even use them to shield yourself (and your own assets) from your partner’s debts.
Getting Adequate Insurance
The right insurance will also help keep your whole family comfortable. For example, good health insurance helps mitigate care costs. This crosses over with long-term care insurance, which will help you look after aging or infirm loved ones when they need assisted living care.
Life insurance also helps people protect their loved ones by setting them as beneficiaries. If you have this coverage, you might set your partner as a beneficiary. If and when you pass, they’ll get a payout that can help with funeral costs and their general financial security.
In addition, life insurance can help mitigate estate taxes. These massively lower the amount that would go towards your loved one. Finally, you could get homeowners insurance, which protects your home - possibly one of your most important assets.
Planning Your Tax
On the topic of estate taxes, you could also limit these by “gifting” your assets. In 2025, you can give up to $19,000 worth of assets per year to someone tax-free; the amount changes yearly. To secure the exemption, the gift must be an irrevocable transfer.
Setting aside money under a 529 plan also protects it from taxation. You (or your loved one) can make a serious impact on a younger family member’s life this way. Beyond college, this money also helps with apprenticeships and K-12 private schools.
Final Thoughts
Working to protect your (and your loved ones’) assets is sure to pay off over time. With the right forms and a good understanding of US estate laws, you should have no problem maximizing the final amount.
