LayRoots

Asset Protection | Live More Carefree

Asset Protection

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Roadblocks

A big tree blocked the road out of our house today. It fell down during a massive wind storm. It made me think about the roadblocks I see in my work as an asset protection attorney.

1) Many people put up a big roadblock between themselves and setting up an asset protection plan. A roadblock between them and those of us who don’t have to worry about the threat of a stupid lawsuit.

2) Asset protection is about putting up roadblocks between you and the scheming attorneys who will make up anything to sue you and take your assets. The roadblocks discourage these attorneys from continuing. It makes them look for another victim.

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Why we don’t recommend land trusts (part 2)

“What about these land trusts I hear about?” is a common question we get.

Land trusts are often promoted as a tool for beating a due-on-sale clause and for asset protection.

We don’t recommend them to clients because we don’t think they work for either of those goals. They give the illusion of achieving those goals, but reality is a different story.

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Why we don’t recommend land trusts (part 1)

“What about these land trusts I hear about?” is a common question we get.

Land trusts are often promoted as a tool for beating a due-on-sale clause and for asset protection.
We don’t recommend them to clients because we don’t think they work for either of those goals. They give the illusion of achieving those goals, but reality is a different story.

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I hope you waste your money

Our power went out recently after a bad wind storm which kept Shreya up at night. I slept somewhat soundly except for when she woke me up by asking, “what was that boom?” (To which I mumbled something and pulled my covers tighter).

When we woke in the morning to a bad power outage and a large tree blocking our driveway – well, that answered that question. We weren’t alone. Around 500,000 homes had no power. And since we live in a rural area, we know we are lower on the list to get things restored after the cities.

It wasn’t too bad though at first. We have a back up power source to run the essentials (meat freezer/refrigerator/coffee maker) and some battery-powered lights and candles. On day two, though, the novelty wore off and things got worse. Our water supply ran out since the well pump was out of action.

Facing the annoyances of no running water, two days in, the power company said we’d have to wait three more days to get service back. We gave up and booked a hotel.

I was hesitant to book, hollering out to Shreya that “As soon as I pay for the hotel, you know that the power will come back on.” And “I just don’t want to waste money!” I clicked confirm anyway.
Sure enough, less than five minutes after I booked the room, the power came back on.

A couple hundred bucks was gone, but I sure was happy to be able to stay home. I was happy I wouldn’t have to live in a hotel down the road for a few days. I was happy our quarter cow wouldn’t spoil as the backup power ran out and the freezer shut off.

Yes, the money was “wasted” but for those 5 minutes, I was grateful to have a back up plan.

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The goal of asset protection

People call us interested in setting up an asset protection plan. Or they want to upgrade the plan they already have.

These people have done their research and have spent a lot of time worrying before calling us. They want to know whether this entity or that entity (like an offshore trust or LLC) will withstand the worst imaginable circumstances. This is understandable – you’ve already imagined these worst imaginable circumstances. You are sure that you will go straight from being served a lawsuit to this extreme. You want to get value for the cost of your plan.

What is this “worst imaginable circumstance” that people are imagining? You get sued, you lose the lawsuit, you get a judgement against you, and then a creditor attacks and tears down your asset protection structure. They threaten you with jail time because you won’t “give up the goods.” You are disgraced, your assets are in jeopardy, and you spent all that money on a plan for NOTHING!

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