Context & Problem

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Many Australians spend years working hard to get ahead — but just one event can unravel that progress. Common setbacks include:

• Long-term illness or injury
• Property damage or natural disasters
• Business disputes or lawsuits
• Relationship breakdowns or inheritance confusion
• Sudden market crashes or job loss

Without a financial safety net, these events can drain savings, force the sale of assets, or lead to long-term debt. Asset protection is the practical side of financial wellbeing — not just for “high-net-worth” individuals.

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1. Build an Emergency Buffer

This is your first line of defence.

• Aim for 3–6 months of living expenses in an accessible account
• Keep it separate from your day-to-day spending account
• Use high-interest savings or offset accounts to keep the money working

It won’t cover everything, but it buys you time — which is critical in a crisis.

2. Review Your Insurance Cover

The right insurance provides targeted protection. Key types include:

• Income protection – covers up to 70% of your income if you can’t work due to illness/injury
• Life and TPD insurance – pays a lump sum if you die or become permanently disabled
• Trauma insurance – helps cover out-of-pocket costs after serious medical events
• Home and contents insurance – covers property damage and theft
• Landlord insurance – protects rental income and damage (if you own investment property)

Tip: Check policy definitions and exclusions. Many claims are denied due to misunderstanding the fine print.

3. Diversify Your Assets

“Don’t put all your eggs in one basket” isn’t just a saying — it’s essential strategy.

• Spread your investments across different asset classes (e.g. shares, property, super)
• Avoid relying on a single source of income
• Don’t overexpose to one employer (e.g. via shares or bonuses)

Diversification reduces the risk of one event wiping out everything.

4. Use Smart Legal Structures

For those with growing wealth or business interests, structure matters.

• Joint ownership and tenants in common affect how assets are passed on
• Family trusts can provide tax flexibility and protection from lawsuits or creditors
• Binding death benefit nominations ensure super goes where you intend
• Prenuptial agreements (binding financial agreements) can protect assets in a relationship split

Legal tools can’t prevent life’s surprises — but they can control the damage. Talk to a solicitor or financial adviser for tailored guidance.

5. Keep Good Records

• Store important documents (wills, policies, mortgage details) in one secure place
• Make sure someone you trust knows where they are
• Digitise key files and back them up securely

Being organised helps you act faster in an emergency — or helps your loved ones if they ever need to step in.

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Isn’t insurance just a waste if I never claim

Not at all. Insurance is about transferring the risk of big loss—not expecting a payout. Like seatbelts, you hope you never need it, but you’re glad it’s there when you do

Aren ’ t trusts only for the wealthy

No—they’re often used by business owners, blended families, or people planning inter generational wealth. But they do come with complexity and costs, so professional advice is important

Is my super protected from creditors (people I owe money to)?

Generally, yes. Super is protected in bankruptcy and can’t be accessed by creditors (ATO, as at May 2025)—but rules can vary for self-managed super funds (SMSFs)

What ’ s the difference between offset and redraw

Both reduce interest on a loan, but offset account share separate transaction accounts paired with a loan, while redraw is the amount of a loan is reduced ahead of schedule. Offset is usually more flexible in emergencies

Do I really need a financial adviser or lawyer ?

If you’re dealing with complex situations (like property investment, superannuation, business ownership, divorce, or significant assets), professional advice is always well worth it. For basic buffers and insurance, you can use our affiliated automated adviser service provided by moneyGPS.