Who has managed to get a heritage from scratch, It is almost evident that you do not need advice on how to protect it, just having it already indicates that you have the necessary virtues: effort and perseverance at work and prudence in your actions. However, there is the possibility that inconveniences arise that make us have a hard time, so it is recommended have professional help to help us have well-protected assets and thus, avoid future headaches.
How to protect family assets against possible unforeseen events?
The first of the rules that must be observed for the protection of heritage is prudence in the decisions that are adopted in the family economy. “Do not spend more than you earn, do not assume economic obligations that you will not be able to fulfill, save, have a minimum ‘cushion’ for unforeseen events. These are the main measures to protect heritage, which will prevent it from being put at risk or, at least, will minimize it”warns Fátima Galisteo, a lawyer at Galisteo Abogados.
“However, there are times when, despite not being reckless in the economic decisions that are made, adverse circumstances, either personal (breakdown of family relationships) or economic (job loss or change in market conditions that make business activity unviable) put the family’s heritage at risk and on many occasions make it disappear”, he points out. But you know, heritage, the same as energy, it is not destroyed, it only changes hands.
Process
“The most immediate and effective thing is to build a liquidity and reserve fund that allows us to go to it in case of immediate or short-term need.”, explains Dositeo Amoedo, president of the Association of Educators and Financial Planners (AEPF). The needs may be different for people, depending on their type of work, their income, assets, etc. “We recommend that the equivalent of amounts that we extract from the average market data and that are normally consistent in order to survive in the short term be set aside,” Add.
We must also be covered for loss of income, illness or disability, protect our retirement, either with a pension plan or other investments in other financial products. And not only retirement, we must also keep in mind the succession, the inheritance, what we are going to leave to our children or relatives, and this also requires planning. How much do we want to leave, what heritage, to whom, etc.
How to measure its economic impact and cover it?
The economic impact is measured by areas of action, and the way to cover it is specific to each area. “The first area we attend to is always budgeting, analyzing present and future income and expenses”, indicate from AEPF.
“At present, if it is expected that in any month consumption is higher than income, a stability fund is established.“, Explain “And on the contrary, if that situation does not occur, what is set is an emergency fund, where an amount equivalent to three months of consumption is saved,” Add.
On the other hand, “For future income and expenses, it will be necessary to determine whether the level of savings is sufficient or a process of maximizing savings must be carried out”, assures Diosio Amodeo. Then, you have to assess the area of protection, where the impact of a decrease in family income will be analyzed for dismissal, illness, disability or death, in this case it is calculated how much would be covered by an insurance policy.
In third place, “there is the area of retirement, very important because of the impact it will have when we no longer have the ability to generate income”, affirms the president of the association, since, if they are not enough, you have to be prepared. Fourth, there is the area of indebtedness, “It should be analyzed how the rise in interest rates impacts on the liability, and clarify whether we cover it with fixed-rate loans or an account with the capacity to meet the variations in the installments in the variable modality.“, guarantees.
And finally there is the investment area, where before investing, a liquidity and reserve fund is always established to cover any impact of this type.
Can a family trust help?
“In Spain, the trust is a hereditary legal institution that is formalized through the will, in which certain assets are left to a person pfor you to manage, enjoy or even dispose of them and that, subsequently, pass to another person who will be the heir of the same “explains Fatima Galisteo.
What happens when you are autonomous?
When we talk about family assets we refer mainly to housing, trousseau, family car, second home, etc. Article 1991 of the Civil Code establishes the principle of personal responsibility of the debtor. “Therefore, the fundamental measure that a self-employed worker must adopt is to absolutely maintain the separation between the activity and the family’s assets, taking measures such as separating property with your spouse if you are married, or the creation of an entity through which to carry out your business or professional activity, which excludes personal liability in case of economic difficulties”says the lawyer.
However, the Law protects certain goods and rights that it declares as unattachable, such as the indispensable means for the exercise of the profession, or salaries and pensions in an amount lower than the minimum interprofessional salary.
