What is the difference between asset protection and asset preservation?

Asset protection and asset preservation are two terms that are frequently used together but have different meanings. Asset protection is the legal process of shielding your assets from potential creditors. This is done through various techniques and strategies such as setting up trusts and other legal entities, gifting assets, and structuring your income and business interests in a tax efficient way. Asset preservation is more focused on the day-to-day management of your assets. This includes ensuring that your assets are properly insured, registered, and protected from risks, such as natural disasters, lawsuits, and theft. Additionally, asset preservation is focused on protecting the value of your assets by investing in low-risk investments and diversifying your investments. The distinction between asset protection and asset preservation is important because one focuses on protecting assets from potential creditors while the other focuses on preserving assets. In the state of West Virginia, asset protection is provided by laws that aim to protect individuals from creditors and lawsuits and allow individuals to structure their assets in a way that is both tax-efficient and legally compliant. Asset preservation, on the other hand, involves strategies such as insurance and investments that are aimed at preserving the value of your assets.

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What is the difference between asset protection and asset preservation?

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