Asset Protection Strategies

Asset protection is the process of legally safeguarding your wealth from creditors, lawsuits, relationship property claims, and other financial risks. You need it if you own a business, are in a high-risk profession (doctor, lawyer, director), have significant assets, or want to protect your family's wealth from relationship property claims, bankruptcy, or professional liability.

When assets are transferred to a properly structured family trust, they're no longer in your personal name. This means they're generally protected from business creditors, professional liability claims, relationship property claims (if transferred before entering a relationship), and aged care means testing. The trust legally owns the assets, so they can't be targeted by creditors pursuing personal liability.

Yes, asset protection through family trusts and other legal structures is completely legal in NZ, provided it's done before creditor claims arise and follows proper legal processes. Fraudulent conveyancing (transferring assets to avoid existing creditors) is illegal. The key is proactive planning - protecting assets before problems occur, not after creditors have claims against you.

Assets transferred to a family trust within 5 years of applying for aged care residential subsidies may be included in means testing. This means you need to plan at least 5 years ahead if aged care asset protection is a goal. The sooner you establish a trust, the sooner the 5-year clock starts. Proper planning ensures maximum protection while maintaining eligibility for subsidies when needed.

It depends on timing and circumstances. Assets transferred to a trust before entering a relationship are generally protected under the Property (Relationships) Act 1976. Assets transferred during a relationship may be considered relationship property and can be challenged. The key is establishing the trust before entering a relationship or de facto partnership. Proper legal structure and documentation is essential.

Most business owners benefit from a multi-layered approach: a trading company for business operations (limited liability), a separate trust owning business property/assets, personal assets in a family trust, and appropriate insurance. This structure separates business risk from personal wealth, protects accumulated wealth, and allows flexible succession planning. We design structures tailored to your specific business and risk profile.

Basic family trust setup starts from $2,500. Comprehensive asset protection structures for business owners (multiple trusts, company structures, property transfers) typically range from $5,000-$15,000 depending on complexity. While this seems expensive, it's far less than losing assets to creditors, lawsuits, or relationship property claims. Consider it insurance for your wealth.

High-risk professions include: company directors (personal liability for company debts), doctors and medical professionals (malpractice claims), lawyers and accountants (professional negligence), builders and contractors (construction defects), real estate agents, financial advisers, and business owners. Anyone with professional indemnity exposure or potential personal liability should have asset protection in place.