Assest protection tips

Tonight, I went to a real estate seminar which taught the subject on assets protection. I thought it was an excellent information and want to share all of you what I learnt tonight

1. Sole, Joint Venture, Teannet In common are bad way to hold title
2. General partnership is the worst way to hold title. You may lose your personal assets if your partner get sued! Double liability!
3. Land trust offer no assets protection
4. LLC or LP is the most recommended way to hold title.
5. Two kinds of attack: A) Tenant fell in your property and sue you B) You had bad car accident and get sued
6. LLC can protect you from attack B, but not attack A!
7. LLC is most recommended to be formed in Nevada or Wyoming. These two states has the best state law in the property owner's interest.
8. You should buy a Umbrella insurance policy to cover your personal liability.
9. Consider putting your brokerage account under LLC instead of your own name to shield against potential lawsuit
10. After transferring your title from personal to a LLC, don't forget to inform the insurance company for the change
11. Use 1 LLC to hold 1 property in the state, and have a central LLC manage each individual LLC. You're the ultimate manager of this one central LLC
12. Debt is good way to discourage creditors.

For more information, I'll recommend you to visit the speaker for tonight's seminar www.sutlaw.com Garrtt Sutton is very knowledgble real estate attroney.

Rule of money. Rule of 72

To become a successful investor, we must be constantly thinking how to compound our money so it can keep growing, growing and growing to create wealth for us. One very very powerful and simple rule to calculate how fast the money compound is called RULE of 72, or I call it rule of money. This rule is invented by the greatest scientist all time. Mr Albert Einstein. I think this rule is even more profound than E=MC^2!

Here's how it works,

Let's say you invest 1000 dollar into a investment account that earn you annual 4% of interest, you wonder how long it will takes for the initial capital to double? Rule of 72 can help you determine it quickly. You use 72 divided by 4, you get 18. This means that after 18 years from the time you invest, your initial capital will double! In our example, after 18 years, your money will become 2000. Please note that we assume we pay no tax and we reinvest our interest each year.
Now, look at the case on the top of this post. Imagine a person have 10,000 to invest at age 30, he put in some kind of tax deferred account which allow money to grow without paying tax until he reach 66 for retirement. Can you see how the small increase of the of annual interest can product A BIG BIG BIG difference over a long period of time? This is the power of compound interest! What if the annual interest is 18%, can you figure how much money will that be at age 66?