Remember in our blog, Tax to the Future, where I reviewed why failing to see tax triggers or tax erosion made wealth accumulation MUCH more difficult? Well what about instead of the IRS getting a small percentage over time, a bad creditor came and took 75% of your wealth? All at once. This doesn’t put retirement on hold, it redefines and downsizes retirement completely!
The same guy that came on our podcast and preached tax efficiency, makes a living consulting on taxes, and even wrote the book, Tax Secrets Made Simple, also admits that his work is NOT the top priority in a successful financial plan. In Ed Cotney’s opinion (and ours as well) asset protection should be the cornerstone of your financial plan.
But here is the odd truth. When it comes to asset protection, possibly the most vital piece of a financial plan, so many people become DIYers! Both my business partner and I have worked for asset protection firms in the past. It was shockingly common to have people of substantial wealth get semi-familiar with a concept or strategy and then say, “Ok, well I think I can do this on my own from here.”
Trust me, when it comes to litigation in a court room, where the attacking creditor is after a $3,000,000 lawsuit, his attorney, who is working on contingency, is going to demolish the “asset protection” you think you have in place. We are talking cartoon sledgehammer to the watermelon demolition. And that’s not a knock on you in the slightest! It’s just that we have seen these cases get very complex and with the end product being your protection and legacy, I can’t fathom wanting to be a DIYer!
Sure, you have an LLC, Limited Partnerships, S-Corps, and C-corps. But what about the Intentionally Defective Grantor Trust, Beneficiary Defective Grantor Trust, Grantor Retained Annuity Trust, Qualified Personal Residence Trust, Charitable Remainder Annuity Trust, Charitable Lead Annuity Trust, Delaware Incomplete Non-Grantor Trust, Nevada Incomplete-Gift Trust, Domestic Asset Protection Trust, Foreign Asset Protection Trust, or Bridge Trust? And don’t get us started on the Have Your Cake and Eat It Too Trust (also known as the HYCET Trust), Non-Income with Makeup Charitable Remainder Unitrust, or the Malta Pension Plan.
So, when Ed wrote in his own book, Tax Secrets Made Simple, that he was not the starting point in a successful plan and advocated that the reader not only get assistance but PAY for the help, we think it’s smart to take that advice to heart.
And let’s be honest. You never wanted to be an attorney anyway. Pretending to be one is all the work with none of the money!
Kingsview Wealth Management does not provide tax, legal or accounting advice. The information was prepared for informational purposes only, and is not intended to provide, and should not be relied on for, tax, legal or accounting advice. You should consult your own tax, legal and accounting advisors.