You’d Better Watch your Assets

The conference in San Francisco wasn’t quite the organized educational experience I thought it was going to be, but there were some very insightful issues that were brought up. (It was a conference for a Utah-based company called investools that sells investing software and business service packages. The concept of the conference I attended was, (other than making money for investools) asset protection. Protection from Taxes. Protection against death. Protection from litigation. They wrapped it up into a neat little package that could be purchased for about 3K, and supposedly would provide all of the asset protection you would ever need.

The strategy was simple. To protect yourself against litigation, set up a family limited partnership and place all of your valuable assets inside it with yourself as the general partner. To protect against taxes, incorporate yourself and funnel as much of your expenses as possible through a separate C-corp. To protect against death place your family limited partnership inside a living trust.

In theory it seems so simple. What they failed to mention however was that a family limited partnership isn’t bullet proof, funneling everything through a personal c-corp is considered fraud, and somethings inside a family partnership can’t be held within a living trust. Hmmm…

It is important stuff to think about though, and finding a qualified personal finance specialist is absolutely necessary as soon as you have enough money to protect. Here’s a great resource for learning more about family limited partnerships.

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