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Thanks
to extraordinary housing appreciation in the past few years, many homeowners in
California are now millionaires. If someone sues, homeowners have a lot more to
lose. If you own apartments, commercial properties, or a business your chances
of being sued are even greater. One of my friends owns a successful business -
she was sued by one of her customers and found guilty by jury in court. She had
to sell all of her real estate holdings in order to satisfy the judgment. Are
you as protected as you think you are? Your
liability insurance to cover your property, business, and automobile covers you
only up to the policy limits. A major tragedy or catastrophic accident can cause
a financial nightmare. If you or your teen-ager got in a traffic accident, you
could end up on the losing end of a lawsuit. Or if your tenant got injured, you
could easily be sued. If you have a swimming pool, you have increased risk. You
might have a very high insurance coverage. The question is, is that enough? How
much coverage is going to be enough? Is having insurance good enough to protect
your assets? We
live in a very litigious society, its common knowledge that nowadays people sue
at the drop of a hat. Lawyers are happy to take cases against real estate owners.
If you're a real
estate owner of any kind, and also own cars, a stock portfolio, saving accounts,
and other substantial assets, just having higher insurance coverage is NOT the
answer. Instead, I strongly recommend you have an Asset Protection strategy customized
for your specific situation. Asset Protection means your assets are legally sheltered.
Lawyers won't be able to find your assets, so they won't bother suing you. Asset
protection means using established and proven methods to legally protect your
lifestyle for your lifetime. Asset Protection is a sophisticated formula combining
estate planning & tax analysis, emphasizing income and inheritance savings
while at the same time protecting assets from present and future harm. True asset
protection is achieved by structuring your assets so that NO PERSON or entity,
other than those you have selected, can ever touch those assets. The
basic asset protection device used in our asset protection planning consists of:
(1) A Limited Partnership, (2) A Limited Liability Company, and (3) A Trust. The
exact device and the structure to be used varied depending on your specific situation
and outcome you wish to achieve. Here is what should be the goals of a good Asset
Protection/Estate Plan: 1.
Protect your assets from any predator (creditor).
2. You have control of your
assets during your lifetime
3. Eliminate probate
4. Eliminate estate and
inheritance taxes
5. Reduce, defer or even eliminate Federal and State income
and capital gains taxes
6. Allow you to direct distributions of your assets
after death
7. Allow you to modify your system
8. Have the ability to
treat your system like building blocks
9. Be certain that you are comfortable
with your system
10. Laws change - Keep your system current A
good asset protection plan redistributes the assets on a balance sheet. A good
plan does not render the individual insolvent - a good plan simply makes it difficult,
if not impossible, for a creditor/predator to get to the assets. I
wish our society was like a utopia, but that's just not the case. The reality
is that we have to protect what we have from those who would attempt to take away
our assets. A good Asset Protection Plan will give you peace of mind and allow
you to enjoy your life to the fullest. For
a no cost consultation about asset protection, please contact me at (310) 800-6333
or e-mail: ytaguchi@scfsecurities.com
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