If you’re a doctor or medical professional, you face more risk than other investors. Learn one of five major mistakes and how to protect your investments.
Physicians and medical professionals face more risk than those working in other fields. Doctors make decisions daily that expose their assets to liability, and addressing this liability is the key to keeping everything you’ve built. Without a strong asset protection gameplan, doctors and other medical professionals leave their assets exposed to plaintiffs’ attorneys and unnecessary taxes.
If you’re a doctor who doesn’t have a strong asset protection and tax planning strategy, the real question is: why? You’ve spent years preparing for your current career with advanced schooling — why leave the fruits of your labor vulnerable?
When it comes to investing, doctors and other medical professionals who don’t have a clear asset protection strategy expose all of their investments to risk in the event of just one lawsuit. Although there are five key mistakes doctors should avoid with their investing, let’s focus on only one for now.
Investing Tip for Doctors: Don’t Own Investments in Your Name
As you build wealth and work to pay down debts and diversify your portfolio, it’s important that doctors protect their investments and assets from personal creditors. In the event that a lawsuit results in a judgment entered against you personally, any account held in your name would immediately be subject to attachment. The easiest way for a creditor to gain recovery on a judgment is to garnish the debtor’s savings, checking, or investment accounts.
The Importance of Charging Order Protections
Regardless of how you invest, as a doctor, it’s critical to protect those investments. One way to provide that layer of protection is to hold your investments in a Wyoming or Delaware limited liability company (LLC). An LLC created in either of these states provides strong liability protection against personal liability claims. The reason behind this is the “charging order” protections offered to LLCs in these states.
In non-legal language, “charging order” protections protect the assets held within an LLC as well as the LLC itself from being seized by a creditor in the event of a judgment against you. Thus, a creditor could not seize your LLC’s assets or take control of your LLC. By reducing the likelihood of possible recovery, holding your investments in a Wyoming or Delaware LLC discourages potential lawsuits.
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This is just one of five major investing mistakes that any doctor or medical professional should avoid. Making any one of these mistakes could put everything you’ve worked your entire life to build at risk.
If you’re a doctor, you’ve worked your assets off to build your career and financial future. Why wait for a lawsuit to hit and wipe out everything? There are simple steps doctors and other investors can take to protect their investments, and we’ve compiled them into one essential white paper for doctors who invest. Click here now to download the white paper.
If you have any questions about the material, reach out to us to schedule your complimentary consultation now. You can schedule online or by calling 800.706.4741. On the call, you and an experienced Senior Advisor will discuss the best ways to protect your assets based on your individual situation. There’s no cost and no obligation, just high-quality information customized to your unique investing situation.