Some frustrating and scary facts...
1.] 70,000 lawsuits are filed each day.
2.] The average medical malpractice award is $3.9 million.
3.] The average legal costs of settling a frivolous lawsuit is $91,000.
4.] The average sexual harassment award against small businesses is $530,000.
No wonder attorneys do not want the laws changed to control frivolous lawsuits...they are getting rich!
Insurance is good, but it is impossible to be insured against every possible contingency. There will always be many exposures for which no insurance exists or which are not adequately covered by which one's coverage or what one can afford. You must realize that "umbrella" policies are not the holy grail of protection that most people believe them to be. We often think that "umbrella" means everything, while insurance companies refer to specific occurrences with specific limits...and being "right" is not always "right". Your insurance company may spend more than your umbrella policy limit, defending you on a claim. Even if you win, you still are liable for defense costs. To make matters worse, if they are defending you, and incur a large defense bill...and you lose, resulting in an award being given to the plaintiff without having enough coverage in your policy...you are liable for the balance.
People with these common factors are at risk:
1.] High net worth and or high liability.
2.] High exposure and visibility.
3.] Assets that are difficult to replace if lost.
4.] Have employees.
5.] Own their own business.
6.] Have professional liability.
7.] Own liability-generating assets such as rental property.
8.] Have children.
These types of individuals need to take proactive steps to protect themselves. No effective legal and estate protection can be started after a lawsuit has been filed. So, realize your value as a target and do something now! Be realistic about the possibility of exposure and the effect a six-seven figure judgment could have upon your future financial plan. Be prepared and be Empowered!
Thursday, May 28, 2009
Wednesday, May 20, 2009
Benefits Of Asset Protection...There Are Many
There are numerous ways to protect your assets. Some may be appropriate for all to use in everyday life, while others may be more appropriate for those with substantial assets that require more sophistication (albeit higher costs) to accomplish the necessary protection. Asset protective measures are also unique to the location and types of assets that need protecting.
Almost all types of asset protection have some sort of common thread that connects them together. This common thread makes it more difficult for a creditor or anyone to locate or attempt to seize them. By utilizing a properly implemented asset protection plan, an individual can legitimately put a rather significant portion of assets out of reach of creditors as well as judgment creditors. The object is accomplish this while retaining a semblance of control over these assets. If the plan is structured properly, the end result would be the destruction of any type of monetary incentive to litigate on the part of a plaintiff.
Asset Protection Trusts are often utilized to insulate assets from such an attack. This is established in an offshore jurisdiction that will control the assets held in the U.S. to be protected under indirect control of the person (settlor) establishing the trust. The object of these trusts is to create an entity that is irrevocable for a set term of years and the settlor is not the current beneficiary. This type of trust makes it very difficult for creditors of the settlor to attach the assets of the trust. The trust is structured so that the assets of the trust are eventually returned to the settlor to regain control with regards to distribution.
This type of trust not only discourages creditors from pursuing litigation against you, but it becomes difficult for anyone to assess ownership and responsibility. This type of protection is very strong...Very Empowering...
Almost all types of asset protection have some sort of common thread that connects them together. This common thread makes it more difficult for a creditor or anyone to locate or attempt to seize them. By utilizing a properly implemented asset protection plan, an individual can legitimately put a rather significant portion of assets out of reach of creditors as well as judgment creditors. The object is accomplish this while retaining a semblance of control over these assets. If the plan is structured properly, the end result would be the destruction of any type of monetary incentive to litigate on the part of a plaintiff.
Asset Protection Trusts are often utilized to insulate assets from such an attack. This is established in an offshore jurisdiction that will control the assets held in the U.S. to be protected under indirect control of the person (settlor) establishing the trust. The object of these trusts is to create an entity that is irrevocable for a set term of years and the settlor is not the current beneficiary. This type of trust makes it very difficult for creditors of the settlor to attach the assets of the trust. The trust is structured so that the assets of the trust are eventually returned to the settlor to regain control with regards to distribution.
This type of trust not only discourages creditors from pursuing litigation against you, but it becomes difficult for anyone to assess ownership and responsibility. This type of protection is very strong...Very Empowering...
Thursday, May 14, 2009
Asset Protection...Empowering Advice
It is not necessary to have an army of attorneys to protect what you have diligently worked for in life. You may not be in a position to afford this level of sophistication, but there are proactive steps you can take to improve the protection of your assets.
Seek good advice! Even though you may not be in a position to retain the services of an attorney for all of your planning, it is very prudent to spend a little to get some general advice when you are planning your financial moves. A qualified asset protection attorney or, at a minimum, a qualified financial planner can give you a footprint to start you off in the right direction.
Avoid general partnerships! These are best to avoid because any general partner is capable of committing the partnership to any number of legal contracts. As a general partner, you along with each of the other partners are jointly and severally liable for any actions the partnership takes.
Separate, separate, separate! I cannot stress the importance of using separate entities for each liability generating asset or business. You should never mix liability generating assets. If you do this, you are just asking for trouble as you are making your potential liabilities exponential in nature.
Beware of "experts"! there are many types of predators in our world. This is evident in the asset protection industry as well. Suddenly everyone is an expert. Always seek a recommendation from those you trust. Avoid "free" offers...there is nothing free. Check out with the proper licensing authorities, the credentials of experts you are considering consulting and retaining.
Lay low! Flashy lifestyles bring about attention...usually the negative type. Conspicuous consumption is asking for trouble. If the public suspects you have a lot of "meat" on the bone, you very well could become a target of frivolous lawsuits. If living a lifestyle that is high flying is important to you, make sure a good portion of your assets should be titled in another name.
Know your jurisdiction and keep it offshore! If you are a target of frivolous lawsuits, state law will dictate what creditors can attach. So, know your laws and how you are protected...This Is Empowering! No country in the world automatically recognizes judgments based in the US, so offshore entities offer significant protection. In fact, many countries think our position on lawsuits is nonsensical.
Insurance is always the best insurance! An asset protection plan might also be a good idea to consider. For a few dollars expended, insurance offers an excellent way to hedge some of your risk.
This advice is not to be confused with legal advice, but rather to remind you to review your protection and to consult the services of a qualified asset protection expert...It Is Empowering!
Seek good advice! Even though you may not be in a position to retain the services of an attorney for all of your planning, it is very prudent to spend a little to get some general advice when you are planning your financial moves. A qualified asset protection attorney or, at a minimum, a qualified financial planner can give you a footprint to start you off in the right direction.
Avoid general partnerships! These are best to avoid because any general partner is capable of committing the partnership to any number of legal contracts. As a general partner, you along with each of the other partners are jointly and severally liable for any actions the partnership takes.
Separate, separate, separate! I cannot stress the importance of using separate entities for each liability generating asset or business. You should never mix liability generating assets. If you do this, you are just asking for trouble as you are making your potential liabilities exponential in nature.
Beware of "experts"! there are many types of predators in our world. This is evident in the asset protection industry as well. Suddenly everyone is an expert. Always seek a recommendation from those you trust. Avoid "free" offers...there is nothing free. Check out with the proper licensing authorities, the credentials of experts you are considering consulting and retaining.
Lay low! Flashy lifestyles bring about attention...usually the negative type. Conspicuous consumption is asking for trouble. If the public suspects you have a lot of "meat" on the bone, you very well could become a target of frivolous lawsuits. If living a lifestyle that is high flying is important to you, make sure a good portion of your assets should be titled in another name.
Know your jurisdiction and keep it offshore! If you are a target of frivolous lawsuits, state law will dictate what creditors can attach. So, know your laws and how you are protected...This Is Empowering! No country in the world automatically recognizes judgments based in the US, so offshore entities offer significant protection. In fact, many countries think our position on lawsuits is nonsensical.
Insurance is always the best insurance! An asset protection plan might also be a good idea to consider. For a few dollars expended, insurance offers an excellent way to hedge some of your risk.
This advice is not to be confused with legal advice, but rather to remind you to review your protection and to consult the services of a qualified asset protection expert...It Is Empowering!
Wednesday, May 13, 2009
Empower Your Assets...Your Interest In Real Property
Imagine a creditor attempting to find out how much disposable money you have access to. Other assets such as copies of deeds, along with financial evidence such as taxes on real property paid are public records that anyone can look up at the county courthouse. Sometimes even appraisers keep records that include the layout of your house, as well as the value of certain aspects of your home. Many of these records are available on the internet. There are a number of ways to keep this information out of the public eye.
Land Trusts are devices that allow you to put your property in the name of another person, company, or bank, keeping your name out of the public records. No one looking at the records will know who actually owns the property, let alone how much it sold for or how often it was sold. In essence it shields your identity, and once the trust is closed the trustee has no duty to keep the records, so there may be no way to find the owner.
Living Trusts are another alternative, especially in states where Land Trusts may be difficult to utilize. Someone other than your self should be the trustee...to keep your name out of it, but understand that sometimes Living Trusts are recorded which makes them less private.
Corporations are entities wherein there is no personal ownership. Assets that have been moved into the corporation are protected by the corporate shield provided that the rules that pertain to corporations provided by the respective state, are followed appropriately. Typically, there are corporate officers and shares are sold in an offering. If you are purchasing real estate, you arrange for the seller to convey the property to the corporation, and then transfer the stock to you.
Limited Liability Companies(LLC) and Limited Partnerships(LP) are two of the best ways to hold real property because they have strong asset protection benefits. As the owner of an LLC, you are not liable for the debts of the business or the acts of employees. If you personally do something wrong, your LLC cannot be taken away from you as long as it is set up correctly.
If you own your property as a Limited Partnership, your property will be protected from the claims against one partner if the claim is unrelated to business. The underlying reason is that it would be unfair to the other partners to have the partnership dissolved or property seized for acts over which they had not control. When it is used for asset protection purposes, an LP is usually called a Family Limited Partnership (FLP). This type of partnership is an agreement between two or more persons in which at least one of them (the limited partner) has no right to control the business and no liability for the debts of the partnership. The general partner controls the business and is liable for all the debt. A creditor's only recourse is to put a lien against any profit distribution after getting a "charging order".
Foreign Trusts (Offshore Trusts) are entities set up outside the US and create excellent asset protection, due to the fact that when you have an Offshore Trust, the creditor who is attempting to collect on your assets must go to the country where the trust is located and pursue the case in that jurisdiction. It cannot be pursued from the US.
Regardless how you set up and protect your assets, it is very important that you retain the services of a qualified attorney who specializes in asset protection. If you have not set up the protection correctly, creditors can pierce corporate veils and attach your assets. Retaining the services of an qualified asset protection attorney is Empowering.
Elizabeth Zagajeski, attorney-at-law, a principal in the Law Offices of Gary Fales & Assoc., is an expert in all forms of asset protection. Feel free to contact me for a private and discreet introduction. Empower Your Assets!
The above information is not to be taken as legal advice. Rather it is meant as a tool to stimulate your thought processes and awareness within the realm of asset protection.
Land Trusts are devices that allow you to put your property in the name of another person, company, or bank, keeping your name out of the public records. No one looking at the records will know who actually owns the property, let alone how much it sold for or how often it was sold. In essence it shields your identity, and once the trust is closed the trustee has no duty to keep the records, so there may be no way to find the owner.
Living Trusts are another alternative, especially in states where Land Trusts may be difficult to utilize. Someone other than your self should be the trustee...to keep your name out of it, but understand that sometimes Living Trusts are recorded which makes them less private.
Corporations are entities wherein there is no personal ownership. Assets that have been moved into the corporation are protected by the corporate shield provided that the rules that pertain to corporations provided by the respective state, are followed appropriately. Typically, there are corporate officers and shares are sold in an offering. If you are purchasing real estate, you arrange for the seller to convey the property to the corporation, and then transfer the stock to you.
Limited Liability Companies(LLC) and Limited Partnerships(LP) are two of the best ways to hold real property because they have strong asset protection benefits. As the owner of an LLC, you are not liable for the debts of the business or the acts of employees. If you personally do something wrong, your LLC cannot be taken away from you as long as it is set up correctly.
If you own your property as a Limited Partnership, your property will be protected from the claims against one partner if the claim is unrelated to business. The underlying reason is that it would be unfair to the other partners to have the partnership dissolved or property seized for acts over which they had not control. When it is used for asset protection purposes, an LP is usually called a Family Limited Partnership (FLP). This type of partnership is an agreement between two or more persons in which at least one of them (the limited partner) has no right to control the business and no liability for the debts of the partnership. The general partner controls the business and is liable for all the debt. A creditor's only recourse is to put a lien against any profit distribution after getting a "charging order".
Foreign Trusts (Offshore Trusts) are entities set up outside the US and create excellent asset protection, due to the fact that when you have an Offshore Trust, the creditor who is attempting to collect on your assets must go to the country where the trust is located and pursue the case in that jurisdiction. It cannot be pursued from the US.
Regardless how you set up and protect your assets, it is very important that you retain the services of a qualified attorney who specializes in asset protection. If you have not set up the protection correctly, creditors can pierce corporate veils and attach your assets. Retaining the services of an qualified asset protection attorney is Empowering.
Elizabeth Zagajeski, attorney-at-law, a principal in the Law Offices of Gary Fales & Assoc., is an expert in all forms of asset protection. Feel free to contact me for a private and discreet introduction. Empower Your Assets!
The above information is not to be taken as legal advice. Rather it is meant as a tool to stimulate your thought processes and awareness within the realm of asset protection.
Monday, May 11, 2009
Asset Protection...Protecting Your Wages
All states have exemptions for certain types of income that creditors cannot garnish, even if they have a judgment against you. These types of income and assets may include wages, salary, social security, welfare, or unemployment compensation. While some only apply to the "head of the household", others apply to everyone. In some states, earnings of independent contractors or sole members of corporations may not be exempt.
Under federal law, the following types of exempt income may not be forced to pay back a debt:
A.] Public Assistance
B.] Supplemental Social Security
C.] Social Security
D.] Social Security Disability
E.] Veterans Benefits
F.] Child Support
G.] Spousal Support
H.] Spousal Maintenance
I.] Workers Compensation
J.] Unemployment Insurance
K.] Railroad Retirement Benefits
L.] Black Lung Benefits
Under federal law, the Consumer Credit Prot4ecltion Act protects employees by limiting the amount of earnings that may be garnished in one week or pay period.
A way to help protect your income from creditors is to place the funds into a separate bank account, called a wage account. The purpose of the wage account is to segregate protected wages and not commingle it in accounts with money from other sources. Another way is to set up a holding company with a sole proprietor as the manager. In this scenario, your name and social security number are no where on the account.
Laws vary from state to state with regard to wage garnishment. It is important to understand your rights under the law respective to the state you reside. Retaining the services of a qualified asset protection attorney will go a long way toward ensuring that you have protected yourself in the best way possible...an Empowering Concept!
Under federal law, the following types of exempt income may not be forced to pay back a debt:
A.] Public Assistance
B.] Supplemental Social Security
C.] Social Security
D.] Social Security Disability
E.] Veterans Benefits
F.] Child Support
G.] Spousal Support
H.] Spousal Maintenance
I.] Workers Compensation
J.] Unemployment Insurance
K.] Railroad Retirement Benefits
L.] Black Lung Benefits
Under federal law, the Consumer Credit Prot4ecltion Act protects employees by limiting the amount of earnings that may be garnished in one week or pay period.
A way to help protect your income from creditors is to place the funds into a separate bank account, called a wage account. The purpose of the wage account is to segregate protected wages and not commingle it in accounts with money from other sources. Another way is to set up a holding company with a sole proprietor as the manager. In this scenario, your name and social security number are no where on the account.
Laws vary from state to state with regard to wage garnishment. It is important to understand your rights under the law respective to the state you reside. Retaining the services of a qualified asset protection attorney will go a long way toward ensuring that you have protected yourself in the best way possible...an Empowering Concept!
Friday, May 1, 2009
Asset Protection...Important Considerations for Owners of Real Estate
Here is a true but unnerving factoid...it is estimated that between 50,000 to 60,000 lawsuits are filed each day in the United States! Not only is this a staggering amount, but it is sobering...An even sadder fact is that a majority of these lawsuits are frivolous and have no merit...just people attempting a "money grab".
The U.S. is one of the few countries where lawyers are allowed to take cases on a contingency fee. This style lends toward predatory litigation...something that should concern each individual, no matter what their level of success.
Successful people worry about protecting their personal and/or business assets from future potential creditors. There are various strategies to keep your property safe from accident victims, tax collectors, health-care providers, credit card issuers, business creditors, and creditors of others.
To insulate your assets, you need to evaluate all your strategies to make sure that you are adequately protected.
We work all our entire lives to accumulate some personal assets that will allow us to enjoy ourselves as we get older. The threat of a lawsuit, even one without merit is frustrating and of a concern as one lawsuit could easily wipe out all the assets that you have accumulated.
There are simple steps that one can take to protect their assets from illegitimate creditor claims. You can begin by reviewing and increasing your personal liability coverages on your home and vehicles. An "Umbrella Policy" is a highly advisable tool to give you a higher level of asset protection.
The first rule in asset protection is to take proactive steps to prevent the creditor from knocking on your door. You need to have a well-defined plan of action in place prior to a claim getting filed against you. Once the claim is filed, it is difficult to protect your "unprotected assets" without causing more harm than good.
The more you have to protect, the more complex your strategy will become. If you fall into this category, it is highly advisable that you should hire a competent attorney and a professional financial adviser to guide you in the most proactive way.
You do have some protection of your assets under the law. Your wages may be garnished only to pay child support, back taxes and defaulted student loans. Asset accounts such as retirement plans, profit-sharing plans and pensions can't be seized by creditors. Creditors are also not allowed to touch the cash value of a life insurance policy or to attach the death benefits from the policy.
We will further discuss various strategies in upcoming posts...strategies that are "Empowering".
The U.S. is one of the few countries where lawyers are allowed to take cases on a contingency fee. This style lends toward predatory litigation...something that should concern each individual, no matter what their level of success.
Successful people worry about protecting their personal and/or business assets from future potential creditors. There are various strategies to keep your property safe from accident victims, tax collectors, health-care providers, credit card issuers, business creditors, and creditors of others.
To insulate your assets, you need to evaluate all your strategies to make sure that you are adequately protected.
We work all our entire lives to accumulate some personal assets that will allow us to enjoy ourselves as we get older. The threat of a lawsuit, even one without merit is frustrating and of a concern as one lawsuit could easily wipe out all the assets that you have accumulated.
There are simple steps that one can take to protect their assets from illegitimate creditor claims. You can begin by reviewing and increasing your personal liability coverages on your home and vehicles. An "Umbrella Policy" is a highly advisable tool to give you a higher level of asset protection.
The first rule in asset protection is to take proactive steps to prevent the creditor from knocking on your door. You need to have a well-defined plan of action in place prior to a claim getting filed against you. Once the claim is filed, it is difficult to protect your "unprotected assets" without causing more harm than good.
The more you have to protect, the more complex your strategy will become. If you fall into this category, it is highly advisable that you should hire a competent attorney and a professional financial adviser to guide you in the most proactive way.
You do have some protection of your assets under the law. Your wages may be garnished only to pay child support, back taxes and defaulted student loans. Asset accounts such as retirement plans, profit-sharing plans and pensions can't be seized by creditors. Creditors are also not allowed to touch the cash value of a life insurance policy or to attach the death benefits from the policy.
We will further discuss various strategies in upcoming posts...strategies that are "Empowering".
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