So I’m watching the Super Bowl on Sunday and like the rest of you, it reminded me of estate planning. For the analogy to work, consider your income, investments, and retirement savings as your offense and your use of tax planning, business entities, and trusts as your defense.

On Sunday, the Super Bowl featured the League’s number one-ranked offense going up against the League’s number one-ranked defense. The adage that defense wins championships and offense sales tickets was proven true when the Seahawks dominated the Broncos in every facet of the game except for pre-game quarterback-hype. Likewise, prudent tax planning can have a bigger impact on your asset column than yielded rates of return. Also, it doesn’t matter how many assets you accumulate if they’re wiped out by lawsuit, divorce, or regretful spending.

Clients often ask what offers better asset protection, a corporate entity such as a limited liability company (LLC) or a trust. Well, they both have their rightful place and often work in conjunction, but they serve different purposes. A linebacker stops the run and offers containment, whereas a safety protects against the deep ball. Corporate entities such as LLCs are designed to defend against your professional and real estate liability and trusts are designed to defend against creditors, predators, and bad spending decisions.

LLCs are as their name implies, used to limit your personal liability from your business liability. Think of a rental home or lawn service company. If a tenant falls down defective stairs and snaps their neck, then they are rightfully entitled to some form of an equitable adjustment, think neck brace and they are now owners of the home, not renters. Or if your employee drives the company lawn mower through the customer’s patio window, through the living room and into the kitchen, the courts will make sure that the property and emotional health that has been destroyed will be replaced monetarily.

What we want to do with LLCs is to create firewalls so that the tenant or customer’s lawsuit stops with your business assets and does not attach to your residence or children’s college fund. If the company assets are owned by the LLC and are not in your personal name, then the ex-tenant and current plaintiff may be barred from going after you personally, with a few exceptions. If there has been a degree of negligence on your part, or if you are commingling your personal funds with your business funds, then a judge will allow your personal assets to be available in the lawsuit. A much deeper explanation is required by your attorney and you’ll enjoy hearing clandestine phrases like “piercing the corporate veil”, but let’s keep it simple for now.

There are trusts for every possible scenario from pet trusts to gun trusts, but most commonly used are revocable living trusts (RLT). Similar to a will, an RLT is your directions regarding what happens to your stuff when you die. However, RLTs go much further by addressing incapacity and allow us to distribute assets the way we want, when we want, and with a mindful eye on estate taxes. They are especially helpful in potentially protecting your children’s inheritance from the chopping block of future divorce settlements, bankruptcies, and lawsuits.

Wills only become effective when you die and your assets are then distributed outright, offering no protection against creditors, predators, and immature spending decisions. If your intent is to prevent your children and grandchildren from Bieber-like behavior, talk to an estate attorney about the use of a living trust.

Irrevocable trusts are impossible to fully describe in one article, but when you place your assets into an irrevocable trust you are giving your assets to someone or something else. This may be done for a number of reasons, but avoiding estate tax liability is often the driver. We can use special needs trusts (SNT) to allow our special needs heirs to continue receiving their need-based government benefits, yet have access to money we leave them as a supplement to their benefits, instead of a replacement of these need-based benefits.

Super Bowl 48 turned out to be one of the most lop-sided contests in the game’s history. The Seahawks could not have one without the talent of Russell Wilson and the rest of their offense, but with an intent to overuse clichés, the best offense is a good defense. So, work hard, invest well, and save consistently. Then prudently utilize your accountant and lawyer to protect your score. Game on!