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Apr 18, 2009 
In my survey that many of you so kindly filled out while back, I learned a lot about how long you have been in business, and what types of things you are involved in. In addition to this data, I asked a simple open-ended question,
“What’s your single most important question about Personal Asset Protection?”
I have found that when one person has a question, that usually means that there are at least 100 others with the same question. So this is a good way to find out what needs to be explained better.
I answered the first three questions back here… and here are the next three…
Do I really need it Asset Protection? (I’m just a little one girl show)
You develop asset protection strategies both for what you have now, and for what you are trying to build for the future. If you are in a business that interacts with the public then you are always going to take the risk that you will harm them in some way which leads to a lawsuit. And your lifestyle and savings are much safer if you are properly conducting that business from inside a limited liability company. The other thing to keep in mind is that many of these records are just documenting good solid business management principles..,
Even if they didn’t do a thing to protect your assets, they would still help you better run your business affairs and create more wealth.
What’s absolutely necessary?
Great question, and it varies for each person. The basic idea of compartmentalization is I think one of the most important things you must understand. You should not have all your assets in one place, ready for one huge wave to capsize the whole boat. The second big idea is multiple lines of defense, where each time one wall of defense is breached, there is another standing right there to continue the protection. In my opinion, corporations are one of the most vital tools that we have available to help us with both of these things.
If you have a Corporation, then the only way to keep it working for you is to do all the required record-keeping. There are five major areas that need to be up to date and clean:
- Incorporation documents and bylaws
- Stock ownership records
- Shareholder and Director meetings and records
- Corporate Resolutions used to document important decisions
- Proper financial documentation with no co-mingling
If you do all these things right as I demonstrate in the clear, concise, step-by-step system Cover Your Corporate Assets (aka Corporate Veil Pro) then you should have a properly functioning business.
Do I need a lawyer?
I think everyone in business should have a lawyer (and an accountant, and an insurance professional, and a banker, and a mentor). The lawyer is there to answer specific questions but I believe that you should be up-to-speed on the basics of why you have a corporation and what is expected of you regarding record keeping and management. You shouldn’t have to pay a lawyer big bucks to teach you these basics. In a few recent blog posts, I gave some instructions on choosing and working with a lawyer that you might find useful.
Have a great day,
Rob
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• Apr 18, 2009 @2:57 pm
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