Asset Protection | Live More Carefree
By Colin Ley
“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.
By Colin Ley
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.
By Colin Ley
Asset protection helps you gain leverage against potential legal threats.
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!
By Colin Ley
Let’s compare effectiveness vs costs when choosing an asset protection trust.
What I forget to mention in the video is that with a hybrid trust, such as our PREP Trust, you have the option to convert the trust to a fully offshore trust if you so choose.
[Read more…] about Effectiveness vs cost for asset protection trustsBy Colin Ley
Shreya loves to cook. If you ask her, there’s very little that she can make without salt. That’s a key ingredient for her to make anything worth eating. (My cooking often comes from a box, so I can’t weigh in). When it comes to asset protection, we often tell people “you can’t do it alone.” A high level of asset protection is only achieved by having an independent third party on your team.
If you want to protect your assets, you’ll need help from someone else. It’s the salt of your asset protection recipe.
A strong asset protection plan involves you having indirect control over your assets. If you maintain direct control of your assets, there will be no asset protection.
Let’s say you are in a situation where a judge is making decisions about your assets and life. That judge can order you to take action that benefits your creditors (i.e., “pay up!”). This order includes any and all assets that are within your direct control.
In contrast, an asset protection trust provides indirect control over your assets. The independent team members, who work for you, provide you with that indirect control. These asset protection trust team members are a trustee, trust protector, or both.
An independent trustee will take care of your assets in the trust for your benefit. That means anything the trustee does, must be in your best interest. If you have an independent trustee for your trust, you will submit requests for money/assets/payments, etc. to the trustee. The trustee will fulfill your request so long as you are not being forced to make the request (via a judge or court).
A trust protector is like a watchdog for the trust. The trust protector has the ability to veto requests to the trustee. A trust protector would make this veto if they think the trust assets were in jeopardy, such as a creditor or judge trying to take the assets. They are another check to make sure that the assets are there to benefit you and your family.
For the highest level of asset protection, a trust would have an independent trustee and trust protector serving as part of the trust team.
The best asset protection jurisdictions allow you to be the trustee of your trust. They don’t require you to hire a trustee. This means you’ll be the one in charge of the assets in the trust. This arrangement works so long as there is not an active legal threat against you.
If you serve as the trustee of your trust, you must have an independent trust protector on your team. You need at least one team member. The trust protector can replace you with an independent trustee if there is a legal threat against you that threatens your assets. The trust protector role severs the direct control you would otherwise have over your assets. Remember…direct control = no asset protection.
The trust protector has the ability to veto your decisions as trustee, if the protector thinks that is in YOUR best interest. This sounds weird, but you want someone to have this control! Remember that judge ordering you to make decisions for the benefit of your creditors? You want someone to stand up for you when that request is made.
Shreya Ley is an asset protection attorney and the co-creator of the PREP Trust® and Better LLC™. She is also the co-founder of LayRoots (along with with partner in life & business – Colin Ley)
Being successful in America makes you a target for bogus lawsuits from shameless lawyers. We created an effective, asset protection solution, so you don’t have to worry anymore, happily knowing your family’s future is protected. Get started now by scheduling a free, 30-minute call at livemorecarefree.com.
By Colin Ley
The US court system is built to allow any and all angry people to sue others. There’s no need to be reasonable. A brittle spirit will be rewarded for fake and exaggerated damages.
This is the so-called frivolous lawsuit.
Desperate contingency attorneys make their living filing these stupid lawsuits against honest people who have worked hard for what they have.
The courts are built for these terrible lawyers and their clients to get paid because it’s often cheaper and easier to pay for the lawsuit to go away instead of fighting for what’s yours.
[Read more…] about I WILL SUE YOU!Serving clients nationally and internationally. Asset Protection Attorney & Outside General Counsel
LayRoots
500 Yale Ave N, #100
Seattle, WA 98109
ProtonMail: @layroots
Phone: 206-219-9559 or Schedule
