What's a Trust?

What’s "Asset Protection" / "Wealth Preservation" ?

Asset protection:   is the concept of protecting one’s assets from frivolous, illogical, ill motivated, more often than not, devastating catastrophic claims against your wealth, designed to destroy your current and future lifestyle. In short:  they want what you've got and they want to inflict maximum pain. 

There are literally hundreds of ways to protect your assets. Some are just common sense. Don’t flash your money around; don’t talk too much at parties, etc. All asset protection techniques have one thing in common:

Make it difficult for your "predator creditor" and his "contingent fee clever lawyer" to first find your money; then try to take it.  Asset / wealth protection is about  "controlling your money by not having title to it."   

There are approximately 950,000 lawyers.  Just go through your own yellow pages.  Most of them live on what they can "squeeze out of you."  Don’t become a statistic. Learn from other people's mistakes.  Learn how to become every contingency-fee lawyer's nightmare. 

By implementing a properly crafted asset protection plan, your creditor will have to jump through several hoops, before he even finds your money. A contingent fee predator lawyer will want an easier target, not yours.

A good asset protection plan will:

• Protect your current and future lifestyle.
• Discourage litigation and promote settlements, in your favor.
• Keep the ownership of your assets confidential and hard to find.
• Eliminate the need of prenuptial agreements.
• Internationalize your investments as a hedge against the unexpected surprise.
• Spread out your control over your most valuable assets.
• Help you in getting a fresh start, if you ever became insolvent in any of your other assets.
• Hedge against potential political, economic, and personal instability.

Asset protection is asset by asset. What’s your asset? What’s your financial goal? Where does the asset belong? Connect the dots between "your asset" ..... "your financial goal(s)"..... and ..... "selection of your financial entity(ies)."

Your private residence, what’s your financial goal? where does the asset belong? domestic, or foreign? Titling your real estate in your name, jointly with your spouse, or jointly with any-one else is extremely, extremely risky (heavy emphasis added). Having anything in you name is extremely, extremely risky. Your checking account, your investment account, your certificate of deposit, your IRA, your other real estate, you sole proprietorship of your business, a general partnership, all are extremely risky. You are simply an easy target for a clever lawyer.

To protect and preserve your wealth your asset protection plan must be an economic disincentive for your predator creditor.

Asset protection has two goals:

1. To make the enforcement of judgments against your protected assets virtually impossible, and
2. To allow the owner of protected assets to retain substantial control over his assets.

Simple "Free" Tips
Not everybody can afford a sophisticated asset protection plan, and in some cases it would be an overkill. However, as your wealth appreciates, your asset protection plan has to appreciate. IT’S ALL ABOUT THE MONEY.  If you have any kind of visible wealth, you’re a target, don’t make any deadly mistake about this fact of life.

Asset protection is a building block, it must be flexible.  Add or deduct building blocks as your needs and financial conditions change i.e. a sudden inheritance, a sudden death of a family member, kids leave, you marry, you divorce, you have a child, you retire, you buy a house, you start a business .....etc.

Separate your assets in different baskets, always use a separate legal entity.  Don’t mix your safe assets with your other riskier assets.  Example: don’t own your apartment house with your stock portfolio account.  Don’t own your personal residence in the same financial entity as your child care facility business. Etc.

Never, never, never do business as a "sole proprietor."  Sole proprietorship is the absolute worst way to do business. You are a walking lawsuit about to happen.

Never, never, never do business as a "general partnership."  Not only will you be responsible for your own financial problems, but you may be held responsible for each and every-one of your partner’s problem(s); even though you had absolutely nothing to do with it and you can prove it 100%.   Deeper pocket theory, he who has the most to lose, will most likely lose it.

You should never be the owner of your life insurance policy.  What your insurance man won’t tell you could cost your heirs 55%. If you are the "incidental" owner of your life insurance policy it’s taxable in your estate up to 55%, before any distribution can occur to your heirs, period.

You are never, never 100% bullet proof.  No matter how difficult you make it, if you are in the United States, a Judge can do whatever he wants.  It’s a court of equity.  It’s a fact, if you have a lot of money, and you are less than star face quality (you’re ugly) DO NOT stand in front of a jury.  Statistics show, you will lose 98% of the time. Internationalize your asset/wealth protection plan.

Don’t show-off.  Don’t flaunt your wealth. Don’t stick it up their nose.  If you are doing well, beware, don’t invite a frivolous lawsuit.  Don’t title everything in your name.

Don’t rely on your state’s homestead laws.  Each state is different and each state has limitations.  Don’t rely on your state to protect you.  They can be sued for aiding and abetting a crime if you use state laws to get away with something.  The state of Florida with the most lenient homestead laws has been attacked for aiding in the commission of a fraud against creditors.  Besides, if you use homestead laws, you CANNOT sell your property.  There are better ways, see the ULTRA TRUST®

Buy an adequate business insurance policy.  The only reason you want a liability insurance policy, is that they must provide for your defense.  In case of a major catastrophe, no matter how much you could afford on insurance it will never, never be enough.  Liability insurance policies cover "actual" losses.  They DO NOT cover punitive damages, jury awards, or other costs over and above actual damages.  Again, and again a very strong case to get your house in order while the sea is calm.  And consider this:   if you have an adequate asset protection plan, you may not need a huge insurance policy.  (Pays for your asset protection planning)

Not all states are created equal.  Local laws and local state laws create your creditor’s ability to get at your assets. Check with a reputable attorney.

Assume that most "asset protection experts" are not qualified.  Notice how all financial planners claim to be experts, experts in what?  Then they try to sell you a "living trust" or try to take management of your money, sell you an insurance policy, etc.  It’s a fact:  an incompetent advisor will cost you far more than a lawsuit.

Never ignore a lawsuit.  If you are served, get good competent advice, and respond.  If you have an asset protection plan, or you have adequately planned, you may lose your case, but they may never be able to collect.

Judgments are not automatically recognized by all countries.  The reality of life is that most countries think that the United States is the most nonsensical legal system of tort, securities, tax, and anti-trust laws.

Get good professional competent advise.  Rely on good planning NOT secrecy. Rely on law and NOT secrecy.  An incompetent advisor will cost you far more than just money.

THE INS AND OUTS of a good asset protection / wealth preservation plan:

ASSET BY ASSET, What’s your financial goal(s), Domestic, or Foreign (International)