strongest asset protection

[Sarah Jones]

I own an investment house and a primary resident. What is the best way to protect them against FUTURE lawsuits from car accidents and business affairs. Both house is currently under my name.

1. Should I get a trust or an LLC?

2. i talk to an attorney and he says the LLC or trust may not be good because if you don't keep expenses for each one separately and COMPLETELY different books he can argue that your using it as the same person and he can pierce the LLC...

What he recommended was just getting an umbrella policy. What do you guys think should i get the name into an LLC, trust, or just get an umbrallea policy ? What is the best way to protect my assets.. What if i buy another investment property..

[Tim Norris]

As it relates to asset protection strategies, think of the work you do with a legal adviser who, upon considering factors such as net worth, estate planning issues and taxation will offer advice regarding entity and ownership issues. I believe this is your "castle walls and moat" around you/yours. Think of the liability insurance as the "archer in the watchtower". The entities you create (LLCs, trusts, etc...), work symbiotically with the insurance coverage. How much is enough? Who really knows, but keep in mind that your "personal exposures", such as your vehicles, home, etc...(assuming you haven't exorcised ownership via trust, etc...), are/should be segregated from your business exposures.

All that stated, I carry $500k on our personal vehicles and personal liability (homeowner), and $3MM in a "personal" umbrella. Frankly, the umbrella, at $230/year is worth it at that limit. We (partner) carry $1MM over the properties we own via LLC. No "business" umbrella. Are these limits sufficient? Again, who knows, but they are in my mind, at least. Statistically they are, as most liability claims are under these amounts.

Really, your asset protection strategy should start with a versed attorney, include your CPA, and possibly your financial advisor. Figure out how to own/control what you have, then make a call, in your opinion, how much insurance is enough. Hope this helps!

Tim