Summer is here and the last thing on your mind is probably asset protection. You’re more likely thinking about an upcoming vacation or getaway, and we don’t blame you. Many families have a cabin, cottage or vacation home: a place that is not only a favorite vacation spot, but is also connected to many vivid, happy memories.
While recalling all the wonderful times you’ve shared at your cabin, have you ever considered that this property is a substantial financial asset? It’s one that needs to be protected. Whether it’s been in the family for several generations or is recently acquired, chances are you want to keep the property in your family.
If that’s the case, then planning can ensure that your beloved home-away-from-home is protected. Here are three common occurrences that affect the owners of family property and how they can be avoided:
- The common right to use: All co-tenants have basic rights to use the property. If accommodation is limited or family dynamics are tense, common ownership can become a problem. This problem can easily be addressed with a written document that outlines who gets to use the property and when.
When creating this schedule, it’s important to account for what happens if a family can’t use their week, or what the routine is two families want to trade weeks. Don’t forget to consider rotating holidays, school breaks, and the best weeks for your particular property.
- Management issues: Vacation homes come with upkeep. Upkeep comes with costs. Who is in charge of paying for these costs? Often the maintenance, cleaning, bill pay, and property management gets placed on those who live closest.
In order to avoid inequality when it comes to management, it’s a smart idea to appoint either a single person or a committee to be formally in charge of organizing budgets for improvements and staying on top of maintenance.
It’s also helpful to consider how costs will be divided among families/owners. If some families are able to use the cabin more often than others, should they have to contribute a greater sum? If some want to make improvements, but others don’t, how do you decide what to do? Asking these important questions before they become a problem is key.
- Legal and financial issues: Let’s say a co-owner goes through a divorce or has to file bankruptcy. How will that affect ownership of the family property? These issues can lead to unplanned costs, and even worse, unwanted heirs. It’s vital to determine and outline how situations like this will be dealt with before they occur.
Asset Protection with an Estate Planning Lawyer
In each of these scenarios, working with an Estate Planning Lawyer that has an understanding of protecting financial assets like family property can make a major difference. Attorney Barry D. Siegel has years of experience helping families like yours understand and document ownership, funding, and use of family property.
Schedule a no-cost, no-obligation consultation by calling 561-955-8515 today and keep your favorite getaway and your best memories safe.