There are two dozen frequently used asset protection structures and countless iterations of these structures. Even the cornerstone structures like LLCs and irrevocable trusts present a great many variations of structuring, drafting and transferring assets to the structure. How do we then know what is the “right” structure to protect a client’s assets?
There is no right or wrong way to protect assets. For each client there are several appropriate choices that we select using the four-factor analysis set out below. Our job is to present these choices to our clients, who then pick the most appropriate one.
Clients often ask—what is the least they can do to keep their assets safe? While that is a sensible question, it is impossible to answer. We usually do not know what is the least that needs to be done to keep assets safe until it is too late to do something about it – i.e., the creditor is already engaging in collection actions. Asset protection is often a shot in the dark. We recommend that clients select the structure that will allow them to sleep at night (knowing that their assets are safe), and not try to guess at the future.
