Posted on September 11, 2009 by Greg Herman-Giddens

Need a Real Life Example of Why to do Asset Protection Planning?

Rich Rodriguez, the football coach for the University of Michigan, has been sued for $3.9 million due to a loan default.  Rodriguez and partners formed an limited liability company, The Legends of Blackburg LLC, to develop a condo community in Virginia.  Apparently, as is customary, he had to give a personal guarantee, and now he's on the hook for a cool $4,000,000.00.

Rodriguez was previously sued by his former employer, West Virginia University, for $4 million over a buyout clause dispute.  That case was settled last year.

Let's hope he learned his lesson and did some asset protection planning before the condo loan defaulted!

 

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Howard Young - September 12, 2009 9:24 AM

With a high income earner like Rich, even if his existing assets are protected how do you avoid payment of his liabilities from future earnings?

RESPONSE: Good question. One way that may help is to make sure that retirement account contributions (protected under ERISA) are maximized. Also, purchase of whole life and certain annuities can help reduce the available earnings.

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