Podcast Episode 82 – Bullet-Proof Asset Protection – Brian T. Bradley, Esq.

Episode 82 -No matter what stage of your financial journey you are at, you should be thinking about asset protection.  Yes, even if you are just starting out.  Brian T. Bradley is a lawyer who specializes in just that, making sure your gains are protected against litigation. He’s going to explain just how to use increasing levels of protection to ensure you have the right and most cost-effective mitigation strategy for wherever you are on your wealth journey.  After hearing this show, you’re going to take a hard look at where you are, and what you need to do in order to obtain bullet-proof asset protection for yourself.

 

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Meet Brian T. Bradley, Esq.

Brian T. Bradley, Esq. is a nationally recognized Asset Protection Attorney. He has been interviewed and a featured guest on many top shows such as: Flipping America Podcast with Roger Blankenship the “Flipping America Guy” and member of the Forbes Magazine Real Estate Council. SharkPrenuer hosted by Kevin Harrington (the original Shark on the hit TV show ‘Shark Tank’ and inventor of the infomercial), Simple Passive Cash Flow with host mastermind investor Lane Kawaoka, White Coat Investors, Best Advice Ever with super host Joe Fairless (the host of the longest running REI show).

Brian was selected to the Best Attorney’s of America’s List 2020Lawyers of Distinction List three years in a row (2018, 2019, 2020,) Super Lawyers Rising Star List 2015, nominated to Americas Top 100 High Stake Litigators List, nominated to the 2017 Law Firm 500 Award. Brian also writes on high-end asset protection.

No more than 2.5% percent of lawyers are selected by Super Lawyers Rising Star. Super Lawyers, is a Thomas Reuters business, and is a rating service of outstanding lawyers who have attained a high degree of peer recognition and professional achievement.

While companies like Martindale-Hubbell have used a general peer-review system for grading attorneys for many years, Super Lawyers goes far beyond a peer-review system and considers the opinions of other lawyers and opposing counsel as only one of 12 indicators in evaluating an attorney.

Less than one percent (1%) of the attorneys of America have been invited to be a member of the Best Attorneys of America. Membership is one of the most extremely selective, carefully screened, celebrated and respected groups of Attorney’s in the country.

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Access the Show Transcript Here

Bullet-Proof Asset Protection

2021, Brent Lacey And The Scope Of Practice Podcast
The Scope of Practice Podcast

Transcript

[0:00] If you’ve ever been rock climbing you’ll know that the safety gear like harnesses ropes and rock anchors are the most important equipment that a climber has no climber gets up on a mountain with a plan to fall off but they all know that it’s not a risk they can afford to take.
They’re protecting themselves from the catastrophic outcome of falling off a cliff they hope they end up not needing it.
But it’s there to protect them in case they do now as you start to build some wealth I think it’s important to think not only about where to invest your money but how you’re going to protect it what if you get sued and the plaintiff comes after your life savings,
you need to protect your assets as you’re Building Wealth otherwise it’s like climbing a mountain with no safety rope and today’s guest is going to show us just how to give you that protection let’s kick it.

[0:43] Music.

[0:50] Welcome to the scope of practice podcast where we help busy Healthcare professionals learn to manage their businesses successfully in master their personal finances now here’s your host dr. Brent Lacey.

[1:03] Hey y’all thanks so much for joining me for the scope of practice podcast where you can get the knowledge and resources you need to grow your leadership skills your business and your personal finances,
welcome to episode 82 if you haven’t already subscribe to the podcast please be sure to go ahead and hit that subscribe button right now and also
hit the button at the top of the podcast player to turn on the automatic downloads that way you can listen to these episodes anytime anywhere even if you’re in a place that doesn’t have good cell phone service.

[1:30] Also big announcement I mentioned this last week but I want to make sure you know the podcast is now eligible for CME credits and it’s free.

[1:38] Every new podcast episode is now eligible for a mapr a category 1 CME credits,
just click the link in the podcast description or go to www.desktoplearn.com / podcast CME to download your CME credits for free.

[1:56] Hey by the way there’s only a few weeks left to sign up for the free online Summit I’m hosting on November 15 through 17 this year called marriage and money MD.
It’s a free 3 Day online event that will give physician families the tools resources and encouragement they need,
to strengthen their marriage and build wealth so they can have the happy family and the financial Independence they deserve.
Just go to www.marriageguy.com money em d.com or click the link in the podcast description to sign up.
It’s totally free to sign up so sign up today and even if you can’t attend Live sign up anyway and you’ll get access to the replays of the talks for the rest of the week.
The conference is also eligible for up to 21 category 1 CME credits so don’t miss out on getting to knock out all of your CME for the year in this one event.

[2:43] Also if you want to get access to the 10-plus hours of bonus content from our speakers.
Plus exclusive access to join the live Q & A sessions at the end of each night with our speakers and lots more bonus content.
You can upgrade to an all-access VIP pass for just $99.
Ticket prices go up to $149 once the conference starts so upgrade today take advantage of those savings again the Summit is free to attend so sign up today at www.marriageguy.com EMD.com or click the links in the podcast description.

[3:14] Before we get into the show let’s talk about this month sponsor empath IQ.

[3:19] 85% of patients read about their Physicians Online before they come in for an appointment many of them will choose their physician based on how good the physician reviews are.
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3755 686 mention the scope of practice podcast to receive two months for free.
My guest today is Brian Bradley Brian is the senior managing partner of Bradley legal Corp and is a leading educator and nationally recognized asset protection attorney.
For high-risk professionals entrepreneurs Real Estate Investors and Ultra high-net-worth.

[4:32] Collectively his firm is managing and protecting over 5 billion dollars worth of assets.

[4:39] Brian also writes and teaches on Advanced the state and strategic planning and he’s a featured speaker at numerous investment Summit,
real estate cash flow finance and life coaching shows.

[4:50] He’s a national expert on asset protection and I’m excited for him to share his thoughts with us on how we can protect our wealth that we’ve been working so hard to build so that it doesn’t all get lost in one single catastrophic event.
I learned a ton during this interview and it really changed how I’m approaching my own asset protection plan so I hope it does the same for you.

[5:10] So here is my conversation with Brian Bradley.

[5:14] Hey y’all thanks so much for joining me to welcome my guest this week on the scope of practice podcast this is Brian Bradley founder of Bradley legal core Brian thanks so much for joining us
no problem thanks for having me on and putting this all together and this is really is going to be a big topic especially for.
By your physician audience and especially if you’re also investing in other assets like real estate.

[5:41] For you on your own medical practice or businesses and I hope that the concepts that we talked about help your listeners understand this area better.
Well it’s really a relevant topic for the people listening because everyone listening either
aspires to that or already is in that kind of setup and so I really think that everyone’s going to get a lot out of this this is actually been something I’ve been looking forward to for quite a while I’ve thought about having a
show about asset protection for quite some time frankly because it’s something that
I’m fairly new to you as well so it’s definitely an area that I’ve seen a lot of mixed opinions about I’ve read all I’ve talked to a lot of different people and it seems like everybody has
their own way of thinking about things so it’s hard to sort through what’s the what’s the best strategy what’s the right thing you know do we just do insurance to be do we need to do
trust we need to do all these different layers of protection and so I’m really excited to start going through all that stuff with us so just to kind of set the stage for us a little bit,
walk us through why is this something that we should care about this concept of asset protection why isn’t it just enough to have insurance we’ve all got malpractice coverage but.

[6:47] So isn’t that enough.
Yeah so as a protection it really just comes down to layers you know there’s never really like what’s the best strategy it all depends on the client their makeup their profile their risk profile what they have were they own it
and there’s a lot of different ways to skin the cap and not every single option is best for every single client.

[7:08] That comes in and so what we do is simply just help protect assets and wealth with this fancy word.
Called asset protection which you know I think I’ll explain what that means in a minute because like even this the explanation of it I think like what is this weird word,
and like I got into and why this area is important in that in the asset protection from the litigation in the trial side of Law and just having clients being sued.

[7:34] And their lives just being turned completely upside down with this false sense of security.
And a lot of these clients are coming to me after they’re being sued so after the fact and at that point you’re just too far down the rabbit hole there’s not much that we can really do it that standpoint
and so I see that what’s contributing to this false security come from people
thinking that they don’t need to do anything and just ride Lady Luck but that’s not a plan that’s just really wishful thinking.
Or they think that their insurance will always cover them which it won’t is important to have you should have insurance as much as you can afford.
And you need it and you need to have good insurance,
but we’re getting more and more clients with claims that are radically in excess of their insurance coverages and obviously Insurance the business so they don’t want to play.

[8:18] Claims they want to click your premiums and there’s a big issue of being underinsured which is a big problem as you grow.
And this kind of goes hand-in-hand with malpractice insurance.
Or you forget to level up your insurance as your wealth levels up or having an umbrella policy,
but people think that an umbrella policy means it just covers everything else and it doesn’t it really just provides excess coverage and more Capital to fight
or a big one is that you think that your estate plan known as a revocable living trust will protect you which they can’t
they aren’t designed to not all trust are created the same they’re not equal there’s lots of different trust that will break down later on or the big misconception that will dive into the deep end also on is that they think that they’re
this LLC that they set up is going to be a One Stop Silver Bullet
but didn’t miss the first letter of the first word limited they tell you straight out in the title of what it is a limited liability company,
and then when we start talking about the liability for those in your listeners in the medical field that goes beyond just medical the medical profession there’s always a business side.

[9:24] That goes beyond malpractice there’s billing issues payroll violations sexual harassment claims and there’s other that are internal that aren’t covered from medical malpractice.
And then you add on other external issues like if you own the property that you’re practicing out.
Or if you’re also investing in other assets yourself personally,
and the sad thing is just like I was you know go through research and am a published a study that shows was like one out of three doctors so 34% of you.
Have already been sued for malpractice and then the longer you practice that percent goes up to 55 percent that have already been sued before the age of 55.

[10:04] And so the risk profile of a typical medical doctor is very high you either have or are presumed to have a high net-worth rather you’re just coming out of residency and just put on the white coat and your worthless you are presumed to have a high net worth or already mark.

[10:19] Depending on your area practice you also have high legal liability.
You have an extensive government compliance requirements with HIPPA and even wage and hour laws and employment laws if you own your own business.
If you own your own practice you also are now a employer with employees and have employment law issues and employment law suits that are
very big I used to do a lot of employment law issues back in the past and your personal investments will have liability.
And also they’re going to generate money for you like real estate and so,
you need to manage all of this and what you do is create these ass protection players and their job is just to give you peace of mind preserve your lifestyle and really just comes down to how
collectible you are in a completely upside-down world where lawsuits work as prone
Thirty or forty years ago the stuff that you were able to get away with back then you can’t really get away with now and this we’re living in a very litigious Society that’s not based on justice but predatory what can I get from this person by filing a lawsuit.

[11:20] So it starts to get very complicated very quickly and as you start to get more assets it starts to get even more complicated it sounds like.
It does could yeah your butt and just grows you can start with the nobody in a very small red button.
And just as you accumulate more and you grow more which everybody wants to do your visibility in your butt and grows with you and then you just seen as a mark.
And that’s where you know like asset protection like I just to find it now comes into play and what it is is it’s not traditional estate planning it’s modern Estate Planning and what we’re doing is placing legal barriers.
Between your assets and a potential Predator like the person suing you before it’s needed and that’s the key word is before it has to be in place before lawsuit comes your way,
and that’s it it’s just a barrier like a safe for your gold or guns or other valuables.
Anything of value you want to put behind the legal barrier and out of your personal name.
So that it’s not easily attached with a lien or reached you know just like the rich and I love the Tony Robbins saying success leaves Clues.

[12:23] The rich don’t own things in their own personal name their businesses and their estate plans and asset protection plans do.
They just get the beneficial use and enjoyment out of them while separating out the liability and so we want to start mimicking that launches so before we get into some of the more practical aspects of things and.

[12:40] We’ll start walking through okay what how do we actually structure these things I want to help people understand what asset protection is and what it’s not I know,
there’s there’s plenty that I’ve had to learn in that I still you know of course have to learn about this particular topic but,
one of the things that I’ve learned is doing some basic reading on the subject is that there’s a lot of things that I thought I understood about asset protection that I clearly was not understanding correctly so maybe you can help us
clarify some common misconceptions or bust a few myths about asset protection so what are some things that maybe Physicians very commonly believed about asset protection that simply isn’t correct.

[13:16] Yeah I think one is that asset protection is it illegal
and it’s not you know insurance is a base level form of asset protection and so you know you have insurance not because you expect to get in an accident or you expect that you know
your plan on doing bad things you have it for just in case you like I don’t plan on t-boning somebody with my car but I have insurance in case I have a car accident in case my house burns down
that’s a very base level entry level area of asset protection another big one I can I get these calls a lot you know
I don’t I’m going to set up an asset protection plan and hide my money and not pay taxes,
and that’s not what asset protection is that’s tax avoidance and that’s illegal people go to jail for that so if you’re calling to say hey I want to create these plans and I don’t want to pay my taxes
there are people who will do that
and they will eventually lose their license and go to jail with you but that’s not what S protection is we’re talking about Predator prevention and loss prevention from lawsuits.

[14:15] If we were to start you know dealing with the taxes on that like again that’s fraudulent you talk to your CPA and wealth managers to throttle the needle in the tax code
those are like those are the two big main ones the other one I get is like I’m getting a divorce and I hate my spouse and I don’t want my spouse to get anything can I create an asset protection plan and take
helmet assets and hide them from my spouse no because this is not a creditor coming up for you this is your spouse who has equal ownership
you know to the assets that you own during if they’re deemed their actual assets so we’re not hiding assets from spouses who have legal property ownership to assets that would work either
that’s actually I hadn’t really thought about that one so I get that all the time I get the divorce one and the tax one probably half half rotations yeah I hadn’t thought about the tax one but I guess that’s that seems like an obvious question that people would want to ask.

[15:07] So let me ask you this why is it that that I have found so many different opinions from different people.
About this subject and why is why is it that it’s so difficult to get straight answers on what’s the right thing and everyone seems to have a different opinion it’s not cut and dried
that’s a great question and it’s because there’s honestly not very many specialist just that practice asset protection exclusively generally,
it’s a business attorney or a real estate attorney who went and took continuing legal education course and learnt about llc’s.
But they also have their other practice their main practice that’s 90% of their practice closing real estate deals or drafting you know contracts reviewing contracts.

[15:48] And I think like okay well let me just tap into this so I don’t have to refer this out to somebody else and get a little bit of extra money,
yeah I am related to the insurance industry and how they make money is cast the largest net that you can.
That’s one thing that someone trying to add another area practice into their fuel can do very easily is cast a very large net on learning how llc’s work for asset protection
but that’s just one very very small caveat of how to protect assets and that’s a very base level entry
spot low level area protection of something is better than nothing but it’s something that any law firm or attorney can do take a one hour of continuing legal education course and now they can start,
music utilizing llc’s what you want just like anyone in the medical profession is when you have an issue you go seek out the expert in that that that’s the largest percentage of their practice that they have and so
for example we practice exclusively,
asset protection for a high risk High net worth clients like we are protecting over 5 billion worth of assets for a really wealthy people that’s all that we do though
if I were to start mixing into other areas of law I wouldn’t be as up-to-date on all the statues and options that I would be able to utilize to help protect the clients
assets so that’s really what you need to start looking through is
if the attorney you’re talking to is only pitching one thing just using LLC just use a Wyoming LLC this is all you need to know.

[17:16] And they’re not really doing a really in-depth risk profile on you they’re not going through your assets
I will start asking questions and looking at their website and what other areas of all that practice and how in-depth are they in this area law,
make sense yeah and the the idea of thinking of them as a specialist makes a lot of sense you know so I think people will definitely resonate to that idea well let’s start getting a little bit practical then so let’s start maybe from early on so let’s say we got someone who is.
Newly out of residency there a new attending maybe they’ve been out for a year or two something like that but very early in their career.

[17:51] Probably still have student loan debts or very little actual real assets maybe even have a negative net worth
I imagine that that strategy for asset protection is going to be different than someone who’s got 10 figure net worth with multiple assets and real estate everywhere and things like that so where are we going to start when we’re early on what does that strategy look like
yeah when you’re early on there’s no there if you don’t have anything to protect like you have no assets then there’s no assets to protect so your first thing right there I would say like go.
From Dave Ramsey and figure out how to pay off your medical school debt as fast as humanly possible.
Before you start buying assets and more BMWs and because like I have a lot of doctor friends up with the neighbors couple of them recently got out of residency in the first thing they did was bought to BMW.

[18:40] Like how’s your school debt coming along like oh I gotta get to that.
Collection got to that before you went and bought two BMWs because think of all the extra money would have had what’s your school that’s out so you don’t have anything to protect we’re not going to be creating a plan for you and most likely you’re going to have medical malpractice insurance with your employer.

[18:57] I’m so just understand the limitations of that and where it is and we can even jump into you know medical malpractice,
you know insurance issues if you want to so I can understand the breakdown of that but I would say first starting out for you would be clear up your medical debt trying to become debt free shouldn’t take you very long you know if you’re depending on your medical practice
and then from there you have your insurance in the your first asset you buy would be an LLC
so what does that look like then is that something as simple as we spend an hour with with an attorney create an LLC and then just start
putting everything under it or is it does it start to get more complicated with having to do different kinds of bank accounts and and starting new checking accounts that’s not in our name and things like that,
doesn’t get very complicated like when you think about let’s just go over like the key concepts of how you know in the tools that we use so we’re going to use generally.
A limited liability company LLC a limited partnership.
Later on down the line and then some form of asset protection trust when you you know become really visible and have a higher networks but think about winter okay when it comes to asset protection we have different layers the first.
Entry layer is a base layer you know I kind of like your clothing is going to sit on your skin is going to be thin this is an LLC.

[20:19] And then as you grow and you add more assets you want to Mid layer which is usually like a little bit thicker like Merino wool that’s going to be a management company like a limited partnership.
And then when you hit the about that 1 million net worth Mark you’re going to want that outer shell waterproof layer the asset protection Trust.
But I layering your now more flexible and can adjust to make yourself more comfortable.

[20:41] And I’ll break down those layers next but when you’re just starting out it’s really simple you know you’re going to be creating an LLC.
It’s going to be most likely a single member LLC in your own personal name because you have no other need for any other different layers yet because you’re just starting out and then you have insurance,
and that’s where it’s that’s essentially where it’s going to stop for you is.
Hello and a bank account you connect a bank account to either that LLC or most likely and operating LLC.

[21:12] So those would that would be your end to your base layer protection if you’re just starting now you’re buying an investment property let’s say or a duplex and then renting a side out put it into an LLC have a bank account you know connected to an operating company
have insurance okay so all right so we’ve got the LLC setup
let me ask you this before we get to the limited partnership and asset protection trust cuz I’m fascinated to hear about these other layers
how much of a hassle is this day-to-day does this because when I’m when I’m balancing my budget at the end of the month and trying to make sure all my bills are paid and everything
it’s really easy right I’ve got my basic checking account and all the money just goes from the checking account to,
the various bills and utilities and things like that and then you know my savings
gets automatically deducted and my investment gets automatically deducted and all that and it’s super easy and it’s very low friction for me so you start adding some of these layers where you have you know now you’re not
as you’re not you you’re now writing as a as an LLC followed by an LP Etc does it start to become,
a big administrative hassles just do the day-to-day accounting the day-to-day bookkeeping or is it a are there ways to keep it.
Simple to where you’re not spending a lot of time this is a question I guess shouldn’t be like that probably be like a good question to ask like a CPA to help ease up you know like the accounting.

[22:32] Part of it but no it’s just like running any other business in your life you just going to have like a quick.

[22:38] Account and have your Ledger’s the it just depends on each individual.

[22:43] The higher your financial IQ is it shouldn’t be very difficult and you should be more paying more attention to these things if you don’t,
have a financial IQ I will start reading some Finance books and just understanding and like taxes.
How to maintain a bank account just in your personal life it’s no different than how you would budget your personal life all you are just saying I have an LLC,
money is coming in and money is coming out so you should be this managing it as should be very very smooth process it’s just adding another bank account that’s a business bank account into your QuickBooks account.
And then maintaining a ledger awesome okay so that definitely helps because I know people hearing this you’re going to think okay well the asset protection sounds great and I like the idea of being secure and have my money protected but I don’t want to spend,
ten hours a month on this thing I’ve got little enough time with my family as it is so
yeah you have like no if you have no assets you should be spending 10 hours on month like you just having money coming in and it’s just you know you shut up like an easy QuickBooks account and it automate sit and you just check it like you would but
at the same time like I may sound a little cruel on this but if you’re not going to spend the time to manage your financial life and you shouldn’t be buying assets because then when you do get sued and you’re not
don’t have your financial life in order and check the new gonna lose that asset you know when you’re getting audited.
And so like that’s where you need to look at okay if you don’t want to spend the time to manage your finances in your assets and don’t invest that’s a reasonable point and you know if you’re if you’re if you’re just putting yourself out there and you’re accepting the risk.

[24:10] You know you gotta ask yourself is it is it worth it to save a few hours a month so that you know when I inevitably get sued for something someday just.
Because somebody was mad for whatever reason then I just lose everything I mean how much is that going to be really worth it.

[24:24] Well that’s that’s where I think it just comes to learning how to systemize things and start reading these investment books and read Finance books and talk to your CPAs and you just start automating your system and creating your team.
As you go like then you have your CPA then you have your wealth managers you have your attorneys
you might end up adding another piece of software on your computer and put your bank accounts and everything’s just there and let the people whose job that is like maybe as you grow then you have.
Hired independent contractor accountant if you don’t want to do it yourself and it’s just so mind-numbing to you that’s where you need to pay attention on.
Great I like spending my money on investments that have passive cash flow on that coming in but.
Now I also need a realize we’ll also have now a lot of risk and options like liability coming and where I’m going to potentially get sued.
Now do I care enough to manage this properly to where I don’t lose it all.

[25:17] Or do I just not care and like you know like I was saying before you know like Vegas money like am I just going to like wishfully think that everything,
goes right from you my whole life and so if you’re going to go and invest and you’re going to start growing your wealth
and chasing down excellence in your life realize that comes with a different mindset that you may have to evolve yourself and your mindset may have to change okay I like that as really a good point to make and so you know some of these things are going to require.
If you want different results and sometimes you just require different strategies to get there so that makes a lot of sense so okay so let’s take
the next step forward okay so now we’re starting to build some assets you know where out of debt were
low six-figure range net worth you know we’ve got some we got a 401k going we’ve got maybe a few assets maybe we have a.
A single real estate portfolio or purchase or something like that so talk to us about the limited partnership he said that’s the next layer up so what does that look like how is it different how does it integrate with the LLC.
Yeah and so limited partnership.
Essentially what you’re doing is just adding a second layer of protection that’s going to ease up your accounting because like as you grow.
And you start investing in different you know like we’ll just use real estate as an easy example different rental properties a lot of clients invest in different states.

[26:33] You’re going to put these out you know create llc’s in different states where the assets are at you know we can break that reason why down later on but eventually you’re going to have a lot of llc’s and you’re gonna have to maintain them and that if you don’t have them.
Consolidated under our like and limited partnership it can start getting very expensive because you have all these individualized K1 so I have to get filed for it’s your CPA and so,
what you want to have is a limited partnership that comes in and owns all those llc’s
and so all those all those individualized K1 so let’s say you have you know 15 rental properties maybe you have five or six llc’s those five or six llc’s will flow into that
limited partnership and so it’s just one tax filing,
at the end of the day instead of having five or six different ones because then that shouldn’t eat into your cash flow and then you have your business account you know your investment account connected to that limited partnership because that’s your management company
so now you’ve cleaned up your accounting system is more flexible now and you can keep growing as you want the reason you want that second layer
to be a limited partnership and not an LLC owning everything is because limited Partnerships
have what we consider like a split personality there’s two types of ownership there’s the GP portion of it and the limited partnership portion of it.

[27:56] All those llc’s will be on by the GP portion and you’re just going to be the managing member of that.
Then eventually what you want is an asset protection trust to own that limited partnership.
And then you would just be the beneficiary of the trust that way you’re not the owner of the LLC you know the limited partnership and then you’re just the beneficiary of the trust,
so you’re taking that out of your name and so it’s an easier way to stack layers of protection where you can’t do that with an LLC without it being pierced.

[28:25] And so there’s a lot more strength of why you want that.

[28:29] Second layer to be a limited partnership not just an LLC it as for more flexibility and better growth and what’s the GP that you mentioned.
General partner so a limited partnership unlike an LLC there’s a there’s a managing member for llc’s.
With limited Partnerships your partner limited Partnerships have two distinct classes of ownership a general partnership share and a limited partnership share.
And so that’s the benefit of having a limited partnership as you have two distinct statutory different classes of ownership types and who do you set up to be the owners
so until you add the trust it would be you once you have the trust and the trust owns that so then if I if I’m the owner of a limited partnership and everything’s in my name,
it doesn’t that still leave me vulnerable at that point yes because you’re not ready for an asset protection trust what you’re doing is staging the the scene.

[29:22] For when you need to asset protection Trust.
And right now at that point so when you’re starting out you don’t need a limited partnership because you don’t have enough assets to have four or five llc’s.
And so once you have about four or five llc’s instead of spinning you know thousand dollars per LLC,
to pay your it’s your CPA to file the K ones and do all of that that’s a lot of money.

[29:43] Well you do is then have all those LCS you clean up your system you have all those llc’s owned by a limited partnership so it’s just one tax filing now not five or six.

[29:53] And now you have a separate business account
set up to that management company now you’re managing and operating like a business and you’re allowing yourself after your next three or four deals you close to come in and have the asset protection trust so you’re not
at this second layer with the limited partnership you’re not adding really any extra protection what you’re doing
is cleaning up your system to save you on you know accounting finances and tax filings and all the different K ones that you have to file your cleaning that up
and then you’re adding the next layer you need so that you can get to the asset protection trust when you need it what do you think about the idea of having a
non-physician spouse being the
either the general partner be the person who is the main owner of the limited partnership I’ve heard that strategy utilized from other advisors I would say don’t overcomplicate your system like what you would have is if you’re still married then your spouse gets sued and then you’re tied up the assets anyways so there’s no reason.
To start messing with the Optics and then if you get divorced then what then your name is not us.

[31:01] On the llc’s in the lp and so there’s a lot more complications that go down the line of just saying oh well I’m just going to put anything in my name and I’ll put it on my spouse’s name who is also your one you’re married and you know as one,
entity so if she’s getting sued your dad said still going to get tied up what we only care about is how collectible are you,
at the end of the day that’s all I care about how collectible are you from a lawsuit when you and your wife own the assets you want the limited partnership to be in both you and your wife’s names because I’m going to Partnerships have to have two people on them,
first of all so you can be the 1% owner share member of it that’s that’s fine.
You’re going to have to have to and you want to have the partnership like I said because there’s a lot of benefits of a partnership from there.

[31:47] But room having your name off of that LLC,
hi find pointless I don’t see the point of that because the next protection layer you want that really strong pass the protection Trust,
is where you get that statutory non-recognition that you really want at the end of the day it’s the limited partnership in the asset protection trust that come into play for how collectible you really are.
So that these lower level areas of protection.

[32:10] You can create llc’s on your own that’s fine like what really comes into play what is the asset protection Trust
that’s when you start getting really strong asset protection gotcha okay I see how I see how we’re doing this okay so so each of these llc’s is like an individual
Shield of some kind and then the limited partnership were consolidating all those and putting in making a shield wall basically it’s one big unit so then the next layer up you talk about is the asset protection trust so let’s talk about that for a second then so.
Yeah so you said when we hit the million dollar Mark or thereabouts is about when we want to start thinking about that so what does that look like and why is that different how is that different from what we’ve done so far.
Yeah so let me just break down this is the final layer you know as you’re really bad weather you know your outer shell layer and Trust have been the longest lasting entities of all entities and they go back to you into the Roman times for holding assets,
but when done right there very strong and can be sculpted to fit how you need them and they can morph as you need them without dealing with funding issues
I’ll let you see with a lot of LLC is because people found them incorrectly and calm.
Or other business entities and so I love trust and then having the trust at the very top of your planning is just very powerful.

[33:24] And so this is really we’re creating an asset protection trusts and more importantly picking the proper jurisdiction comes into play for the trust and so like I said like trust comes in lots of different flavors and types.
The standard 101 trust that everybody is familiar with from the 60s is the family revocable living trust.
And so like this because trust don’t die so when you do and you actually funded the trust by transferring ownership and title out of your name into that trust.

[33:53] You don’t have to go through the courts and probate you know and it helps with this death taxes then you also have
land trust for Real Estate that hold your land and you can connect them to llc’s but the problem with land trust is that they don’t have any protection in and of themselves they’re only as strong as llc’s.
And so from there you have higher levels of trust and these are called asset protection trust this is where this is the type of trust that we’re talking about now.

[34:21] And these really came about in the early 1980s in 1984 in the Cook Islands.
And what these really are a called self settled spendthrift trust meaning they’re created by you for yourself as your own beneficiary.

[34:35] Was creditor protection from spendthrift Provisions now.
This lets you protect your assets while you’re actually living from creditors trying to sue you and not relinquishing control of your assets.
And so the difference is they allow you to protect your assets not just for your grandkids but for yourself while you’re living which you weren’t allowed to do in the past now the difference with asset protection trust really comes down to where do you set these up in
and why it’s so important is that the laws and the rules that government you and trust and business entities.
They’re different from one jurisdiction to another and that means from like one country to another one state to another even one count,
to another so you have three options when you establish and create these you can create these asset protection trust domestically meaning here in the US,
or you can set them up offshore and another country like the Cook Islands,
or you can create a hybrid which is kind of combining The Best of Both Worlds now I think the best way to break these down is just by talking about it historically
so just from a little historical context of this the offshore trust came first like I said in 1984.
Well the famous Cook Islands created an asset protection trust and I prefer the power of going offshore when you need to just because it offers the best.

[35:53] Home court advantage what you get is this thing called statutory non-recognition and that’s.
Meaning like is the global gold standard for last 40 years because it means that your us judgment is completely worthless in the.

[36:07] You have to start your case all over from scratch facing the highest legal standard in the world the murder.
Beyond A Reasonable Doubt the plaintiff would have to front all the court costs and have to fly in a judge from New Zealand.
You can’t take your us attorney’s with you there they don’t allow contingency fee based attorneys.
A great feat if you lose you know the view pay and so like when you’re trying to prove a case Beyond A Reasonable Doubt like good luck to win and so and there’s only one year statute of limitations,
and so that’s why for 40 years it’s just been the global gold standard because they just do not recognize any countries
core origin judgments per their constitution and statutes.
But if you’re pure leaf are not everybody needs that level of protection like that’s the one you know like caveat against it
it’s just overkill for most people and honestly it’s a hard pill to swallow because they’re so expensive like generally 50,000 dollars and it costs anywhere from 5 to 10 grand.
A year just to maintain so what you see are people who don’t want to deal with the cost and the extra IRS hurdles they just settle for purely domestic asset protection trust like in Nevada.

[37:16] Now the domestic US based asset protection trust came back into Play Ten Years Later you know when the Cook Islands came here to Alaska and help create of all places Alaska,
the first US based asset protection Trust.
And then not to be outdone you had Wyoming Delaware and Nevada they all followed suit there so now we have about 20 states with domestic asset protection statutes.

[37:41] Like I said like there’s pros and cons to everything right.
So the problem with purely domestic asset protection trusts and why they fail is it on a on being effective because at the end of the day when you create something you want it to be effective you wanted to know function how
first intended use so we have the Constitution the US Constitution and in the Constitution we have the full faith and credit clause
and so that means you can’t run from judgments of other states so if you created a Nevada asset protection trust and you’re getting sued in California and you have a California judgment against you
Nevada has to recognize that California judgment you can’t run from it and say well nananananana I have a Nevada asset protection trust to bat doesn’t work that way
and then we have a case in California called kill Carver Stillman came out in 2012 and this case said hey you know your California residents
you’re not Nevada residents so we’re not going to recognize that other states trust that that Nevada asset protection trust and so we’re going to pierce it and now all your assets you put in that trust or not going to be vulnerable for lawsuits
and so because of the bad case law we’re starting to see I’m not a big fan of anything purely domestic for asset protection Trust.
Or just like totally anything purely domestic without a built-in offshore.

[38:55] And that’s the third option the hybrid option and it’s called The Bridge trust and I prefer this hybrid Bridge trust for about 95% of all of our clients.

[39:05] And the reason is you’re combining The Best of Both Worlds is been around for over 25 years so it’s been tested.
And at the end of the day it’s a fully registered foreign offshore asset protection trust with,
the over 40 years worth of case law all the way up to the Supreme Court so it’s fully rugged fully registered offshore day one you have your offshore trustee and standby just in case you need them in the Cook Islands
but what we do is we build a bridge back to the us so that the IR s– classify the trust as a domestic us Trust
by complying with USC section 7701 and so because that we build that bridge back it’s now cheaper to set up so instead of $50,000 generally for a full plan you’re talking about $29,000 it’s more flexible
because it’s both offshore and onshore,
you have none of all the annoying IRS compliance has because Wallace domesticated in the US you don’t have to disclose all the assets that you have which are required to for foreign trust and really have no IRS tax filings and disclosures at all,
because the trust is actually classified as a domestic us grant tours Trust.
But you get that power of the off short strength that you need in your back pocket in your toolbox if and when you ever need it.
So that’s the seems like a really good option it seems like it gets very complicated very quickly but it’s helpful to have it break down into a few simple steps and I think your point from earlier is really well taken that at.

[40:35] At the point that you’re starting to create this I mean we’ve been talking for maybe a half hour and.
It already has gotten quite complicated at least in my mind but this is where having someone you know a CPA having an attorney who actually knows what they’re talking about and actually can set this kind of stuff up for you can really help to make things,
simple for you,
it starts to really make a lot of sense that this is going to be worthwhile to do if you’re talking about having Assets in the million to two million to five million to 10 million dollar range
you know if you can’t spend you know 20 30 grand to protect it and you put all of it at risk that seems like an unnecessary hazard.
No it does and it’s,
not complicated to manage is really easy to manage like obviously I wouldn’t say like you’re not going to be able to go in and create these on your own and think that’s going to be you know help you at all I generally just me and you know when I was doing trials
I would have people coming so create llc’s and they were just created so poorly.
You know even from doctors like don’t you know don’t be your own doctor don’t be your own lawyer you know lawyers don’t try to be your doctor.
You know it’s just go to The Experts go to the specialist because we’re good at what we do.
And so I would say if you’re going to try to do it yourself and backdoor create it is going to fail and then when you are in court is not going to function.
I mean need to go to the specialist and so.

[41:55] The way it all kind of works I think this like kind of paint a better picture of it from the ground up that first layer is your base layer.

[42:03] Your insurance and then your single member district guarded llc’s and then these llc’s they’re going to hold your real estate and your other assets that can hurt somebody.
Or has a key or can go boom like boats and planes are going to put those in the individualized llc’s in the states that they’re located at,
the next layer is your multi-member asset management limited partnership,
which acts as your holding company and it’s going to hold the bulk of your assets like all those llc’s and then you can put your cash your stocks or bonds your investment accounts and their your passive syndication shares receivables.
Whatever all of those go into that limited partnership now it’s easier to manage.

[42:43] The final layer is your outer layer which is that passive protection Bridge trust and it’s going to be that Minority limited partner of the limited partnership.
This is the non-controlling interest but it’s the ownership interest and that’s what separates out ownership from you soon enjoyment.

[43:00] And then it’s really simple either two things happen.
You die hopefully many many years later down the road and your assets are going to get distributed per your directives of your living trust whoever your beneficiaries are.
Or the other option that happens is there is a crisis like a lawsuit you get sued and then the bridge is triggered
and then the assets cross the bridge through the migration policy and then you have the power of statutory non-recognition in your back pocket and that brings you to the table of the negotiating table at a power of strength by having that in your back pocket
then when the lawsuit goes away we bring queried domesticate it
and everything’s back to how it was I really appreciate that we are able to break this down into a step-by-step plan because I think that that makes it more accessible for people and really gives us a sense that okay this doesn’t have to be as
complicated maybe as we originally thought but just in a return to the subject that you made the point earlier if we’re early on in our careers.

[44:01] Don’t get too fancy with it just yet focus on paying off your debt
starting to build some of those assets then you have actually something to protect and then start working your way up this check correctly I wouldn’t
someone just said I want to bridge trust in you don’t qualify for it I’m not going to take
someone’s money for something that they don’t need you scale and grow as you do you just need to realize where you’re at isn’t where you’re going to end up and then your protection planning of where you are at
many many years ago probably is not going to match up to the needed protection that you need 10 years of growth
and so just like your insurance needs a scale up as you scale up your planning needs to scale up as you do so if you’re just starting out you’re going to start out with insurance and an LLC,
and then as you grow then you’re going to add that management company then as you grow your going to add that asset protection Bridge truss.
At different stages of your life now if you come in like most clients they don’t do anything.
For many many years and they have a bunch of assets a bunch of property worth you know 1/2 million they got scared because their neighbor their business partner got sued and they just got rattled and they realize wow we are exposed because everything is in my name.

[45:10] Then we come in and do a full package workout for them like llc’s limited Partnerships asset protection Trust
and everything until it takes about 30 days for us to create off the door from start to finish
but that’s how generally most people will come in down down the line all the assets already accumulated with the scare Factor
from somebody out of their life or they just got sued I have doctors who just got through medical malpractice lawsuit and then they come in and realized I don’t ever want to be in this week position again now we need to get to ship right well Brian this has been a really practical,
practical discussion I appreciate you coming on if people want to learn more they want to continue the conversation maybe even talk to someone about setting this up or just want to,
kind of dive deeper into this topic how can people connect you to continue that conversation yeah they can jump on my website at www.keytime.com legal.com.
And I have I use it as more of a legal resource for people to just go in I have lots of.
Case law on there and illegal Resource as well as a lot of Articles written on,
breaking down why limited Partnerships verse Wyoming llc’s and because a loss of different tools so I want people to be able to go in.

[46:20] Educate themselves before they start talking to people so they can ask the right questions and know if you’re being sold a bag of goods or not.
For they can just email me Brian Bri a n @b TBD go.com,
and I do a one-hour free consultation I rather just have you be educated then have you you know randomly doing Google searches and be you know thinking you’re going to be a Google attorney,
yeah I’ve seen you I’ve seen coffee mugs and say you know don’t think that your Google search for places my medical degree so don’t think that your Google search for places your lots of great,
not exactly like I can tell that by my doctor friends all the time like stop pretending to be a doctor Michael you stop pretending to be a lawyer come on love it I love it well Brian has been a fantastic discussion I really appreciate you coming on I’ve personally been struggling with this concept for a long time and I
I felt like this was very clarifying I feel like I know a lot more now so I really appreciate you coming on the show.
Well guys this is Brian Bradley he’s you can definitely connect with him will make sure to have all of his links on the show notes in the podcast description so Brian thank you so much for joining us on the scope of practice podcast today we really appreciate it.
I really enjoyed being on thank you.

[47:29] Music.

[47:34] I completely overhauled my own asset protection strategy after this interview with Brian.
I hope you were able to pull a few pearls that will help you make sure that your hard-earned wealth is adequately protected you know we’ve had a few episodes on the importance of insurance where we talked about how insurance is meant to protect against risks you can’t afford to take,
well losing a multimillion-dollar lawsuit attending up penniless is a risk you can’t afford to take so make sure that you’re protecting your assets,
keep what you’ve earned hey don’t forget you can sign up for free for the marriage and money MD Summit on November 15th through 17th at www.marriageguy.com money MD.com.
Don’t miss out on this amazing Summit it’s free and it’s full of amazing speakers and phenomenal content sign up today by clicking the links in the podcast.
Also if you upgrade to the all-access VIP pass today you get lifetime access to the presentations 10-plus hours of bonus content a free online financial planning course to give you a concrete step by step plan for Building Wealth.
MP3 files of all the talks and exclusive access to attend a live Q & A sessions after the summit presentations each night with all of our amazing speakers that
right there is worth the price of admission tickets are $99 until November 14th the day before the summit so take advantage of the great savings and upgrade now just click the link in the podcast description to register.

[48:58] Thanks so much for joining me on the scope of practice podcast today,
you can also find all those resources in the show notes at www.scopemonth.com / episode 82.
Or just click the links in the podcast description thanks so much for joining me and I’ll see you next time.
Thanks for listening to the scope of practice podcast at www.visaplace.com.

[49:24] Before we end here’s a quick reminder if you want to streamline your five star patient review generation contact empath IQ at www.scopemonth.com,
/ empath IQ that’s www.scopemonth.com EMP ath IQ.
Mention the scope of practice podcaster received two months for free.

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