Should I establish an LLC?

[Rebecca Shoniber]

At what point do you establish LLC and close in those?

Our first deal was in our name being we did a live in flip.

We are looking for our next non owner occupant investment property.

[Scott Smith]

Originally posted by @Rebecca Shoniber:

At what point do you establish LLC and close in those?

Our first deal was in our name being we did a live in flip.

We are looking for our next non owner occupant investment property.

I often break it down into the "four pillars" of protecting your assets. The first pillar is a good insurance policy as that cover the majority of your exposure. However, it only protects you from one type of liability: accidents.

After that you want to compartmentalize your assets, which is often accomplished through the use of LLCs or corporations. I personally find the Series LLC to be a great tool for the individual investor who is planning to expand their operation, as it allows for you to scale infinitely - check out this article to learn more. The third pillar is somewhat similar - you want to separate your operations from your assets. That means you establish a Traditional LLC to carry out the operations of your investments, in order to separate the liability from your assets, including: paying property management, paying contractors, collecting rent, marketing, etc. Finally, with the use of Trusts while establishing these structures you can add a level of anonymity by removing your name from public record.

I really just break down the current personal exposure a client faces, what investments they have and their future investment goals. After that we lay out some different strategies that are effective and the client can decide on the level of protection they see.