In the medieval days, a person’s wealth would be stored in their castle, and a moat was built around the castle to protect it. The knights knew that if the moat was penetrated, there would be no do-overs to rebuild the castle, so they tried to get it right the first time, using perhaps hot oil, sling shots, and alligators in the defense system.
In the modern world, much of a family’s wealth is in intangible assets, such as stocks and bonds, and the modern moat is a well thought out and implemented asset protection plan that might include insurance, trusts, incapacity documents, and other wealth preservation strategies.
Imagine losing your home due to a catastrophe, and finding out that you have less than full replacement value coverage on the home. The insurance company replaces your home with a van down by the river. Imagine losing your new car to an accident, and you find out that you have only enough insurance coverage to replace it with a 1985 Yugo. Perhaps you are the subject of a lawsuit and find that you don’t have proper liability protection.
Many people don’t realize that, like a home or automobile, your life has an economic replacement value. The human life value approach to calculating the proper amount of insurance coverage helps you assess the financial loss your family would incur and takes into consideration the net future earnings that would be lost if a breadwinner passes away or becomes disabled and can’t work.
What about incapacity? While many people think that they would take care of their spouse if they had Alzheimer’s disease, the cost to the family – physically and financially – can be enormous. Having a plan to protect your assets from the cost of nursing home care and the right incapacity documents in place (Durable Power of Attorney, Health Care Proxy, Living Will) is imperative. One must also consider the use of trusts and a will to ensure that your legacy lives on in the event of your passing.
Here at DCM, we believe that everyone should build their modern moat before considering savings and financial growth strategies, and that’s where we start every plan. It does no good to work and save if the fruits of your labor are lost to an event that could have been protected against.
Call us so we can help you build a moat around your castle. There are no do-overs in asset protection planning!
Del-Sette Capital Management, LLC (“Del-Sette”) is a Registered Investment Advisor (“RIA”), Located in the State of New York. Del-Sette provides investment advisory and related services for clients nationally. Del-Sette will maintain all applicable registration and licenses as required by the various states in which Del-Sette conducts business, as applicable. Del-Sette renders individualized responses to persons in a particular state only after complying with all regulatory requirements, or pursuant to an applicable state exemption or exclusion.
Please note that nothing in this blog post should be construed as an offer to sell or the solicitation of an offer to purchase an interest in any security or separate account. Nothing is intended to be, and you should not consider anything to be, investment, accounting, tax or legal advice. If you would like accounting, tax or legal advice, you should consult with your own accountants or attorneys regarding your individual circumstances and needs. No advice may be rendered by Del-Sette unless a client service agreement is in place.
Views and opinions are subject to change at any time based on market and other conditions.
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