August 24, 2021
Best Ever CRE Team

8 Tips for Protecting Your Assets

As real estate investors, most of us are primarily focused on how we can make more money. However, it’s also important that we give some thought to asset protection. You can have all the money in the world, but if you’re not protecting your assets, it means very little.

We spoke with Brian T. Bradley, an asset protection attorney, about what we all need to be doing to protect our assets in case we’re faced with the rest. Read on to learn more about protecting your assets.


Who Should Protect Their Assets?

Whether you own one property or 100, you should always ensure that your assets are protected. If you are new to investing you may feel that you don’t have much to lose, but if you’ve put a lot of your personal money into your investments, even a small hit to your assets could be a staggering loss.


Why Protect Your Assets?

You should protect your assets because you never know what may happen. You may feel invincible or think that there’s no possibility of getting sued, but no one is immune. If you’re investing in real estate, there are all sorts of things that can go wrong. However, even if nothing goes wrong with one of your investments, if for whatever reason you are sued for something related to your day job or in your home, assets in your name could be in danger.


When to Protect Your Assets

You should start thinking about asset protection as soon as you acquire assets. One of Brian’s biggest recommendations to his clients is to start protecting their assets before there’s an issue. It’s much easier to protect your assets when nothing is going on.

Once there’s an issue or you’re in the middle of being sued, it’s still possible to protect your assets, but it can be much more challenging and much costlier. It’s always better to do damage control before the damage is actually done.



Brian and his firm use a method called ECCM (Effective Control Cost and Maintenance) to help their clients protect their assets. The idea is to set up effective systems like getting your assets out of your name with exemption planning and eventually setting up a trust like an LLC.

Control refers to making sure you control your assets without actually having them in your name. The cost to protect your assets is also essential. You need to be able to afford to make the necessary actions. The overall goal here is maintenance — you want to be able to maintain your current lifestyle even if the worst happens.


2. Choose an Asset Attorney

One of Brian’s biggest suggestions for investors is to spend some time looking for an asset attorney. Many people choose the first firm they find, but not all attorneys are the same. You should vet your attorney to make sure they can meet your unique set of needs. It’s too late to find out you have the wrong attorney once your assets are in danger.


3. Asset Diagnostic

The first thing your lawyer should do is run through an asset diagnostic. This tool will allow them to see exactly what you have, what it’s worth, and what is most vulnerable. From there, the lawyer should be able to figure out which of your assets can be put into an exemption. Then you can work on protecting what’s left.


4. Set Up Trusts or an LLC

Once you’ve figured out which assets need protection, you’ll want to either create an LLC or set up a trust. The one you choose will depend on exactly what you have and what you’re planning for the future of your investment business.


5. Choose a Jurisdiction

When setting up a trust, you have the option of going with a domestic or foreign trust. In most situations, you’ll want to establish a foreign trust, because you won’t be subject to U.S. tax and liability laws. Brian’s company often goes with a bridge trust, which is a domestic trust with the potential to move foreign if need be. This process allows investors to keep costs minimal as long as possible.

However, you want to make sure you choose a location that’s stable and advanced enough to maintain banking standards. Brian recommends the Cook Islands because they’re completely out of the U.S. jurisdiction and it’s difficult for someone in the U.S. to file a lawsuit there.


6. Use the Wealthy as a Model

Even if you don’t consider yourself among the wealthy, you can use them as a model for how to manage your assets. You may notice that the wealthy have very little in their name, but still reap the benefits of their assets. This is a wise move to follow.


7. Don’t Assume You’ll Never Be Sued

According to Brian, one of the biggest mistakes he sees many of his clients make is assuming that they’ll never be sued. They feel that the nature of their particular business or investments precludes them from a lawsuit.

More than 50% of the people who contact him are already in the middle of a lawsuit. You should always consider that you could be sued and make every effort to protect your assets before something happens.


8. Fraud and Fraudulent Transfer

One of the biggest issues comes with fraudulent transfer/conveyance. If you’re not in the middle of litigation, tax audit, etc., then the transfer of assets is typically considered benign.

The problem comes when you are in the middle of one of these situations and you attempt to transfer your assets. The court may see this move as an attempt to get around the law and may not rule in your favor.

However, a fraudulent transfer is not the same as fraud. Fraud is more intentional and means to cause harm. Fraud is illegal, while the fraudulent transfer is not.


Parting Thoughts

No matter where you are in your investment journey, it’s important to be proactive when it comes to protecting your assets. No one is immune, and it’s possible to lose everything. If you put a plan in place before something happens, you’ll be much more likely to come out on top.

Disclaimer: The views and opinions expressed in this blog post are provided for informational purposes only, and should not be construed as an offer to buy or sell any securities or to make or consider any investment or course of action.

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