How to reduce liability in your business activities
I was having lunch with a friend, who works as a financial planner, and he mentioned a client who had been sued and who had to pay out a large settlement that was based on the value of her business as a result. Ouch. The business owner kept a lot of cash in the business for a variety of reasons (it can seem smart to do that as business owner!), so the creditor was able to collect a much larger settlement than they would have been able to if those assets were held elsewhere.
There are ways this business owner could have reduced the risk of judgments to lawsuits while maintaining the necessary or preferred amount of capital in the business. Here’s one example: [Read more…] about Asset Protection Strategies: Separating Business Activities