Back in October of 2012, internet chat rooms and Facebook feeds were buzzing about the downfall of self-help guru Robert Kiyosaki.
The headlines stunned many: “Rich Dad Author Files for Bankruptcy.“
“Rich Dad” fans were reeling …
…while the crusty, jaded, unsuccessful naysayers had a heyday.
(isn’t it bizarre how some people find pleasure in other people’s downfall?)
At The Living Legacy Group we’ve discussed the works of Robert Kiyosaki. We feel his writings are a great introduction to the proper mindset you need to become wealthy… and to escape the scarcity mentality that infects the masses.
So, do we now have egg on our face?
Has Kiyosaki been exposed as a fraud?
Will following his advice leave you a “poor dad” (or mom)?
Hardly!
We’re not going to get into all the dirty details of his bankruptcy filing, but as you’ll see…
Kiyosaki's Bankruptcy Provides YOU with a Great Lesson On Wealth Protection
You see, Robert Kiyosaki did not file for personal bankruptcy.
At the time, he was still worth an estimated $80 million.
(And that money is safe from the litigators in this particular case).
It’s one of Kiyosaki’s businesses that filed for corporate bankruptcy.
And it’s not even a business that’s been actively operating for a number of years.
The name of the company is Rich Global, LLC.
A former business partner (Learning Annex) sued Rich Global for unpaid royalties going back to 2002-2004. Rich Global contends that the royalties were never part of the deal.
The courtroom arguments on both sides were compelling. It could have gone either way. But the jury eventually decided in favor of Learning Annex.
The court awarded Learning Annex with a $23.7 million judgment against Rich Global.
But like we mentioned, Rich Global hasn’t been doing active business since 2009. When it filed for bankruptcy in August, 2012, the court papers showed it only had $1.8 million in assets.
That’s hardly enough to satisfy a $24 million dollar judgment. So the only real recourse was to file for bankruptcy and dissolve the corporation.
Learning Annex is upset that they will only get a tiny portion of their judgment. And maybe rightly so, but that’s not the point here.
But because this was a corporate bankruptcy, Kiyosaki’s personal assets were protected. Learning Annex can’t touch that.
Which is the whole point we’re trying to make here.
You see, no matter who you are or what you do, the more money you make and the more wealth you accumulate, you WILL become a target.
As every first-year law student learns…
Success Breeds Litigation
Which means in humble, everyday language: “If you’re rich, people are going to sue you.”
But don’t be fooled into thinking you have to be as wealthy and successful as Robert Kiyosaki to become the target of a lawsuit.
No matter how much money you make or how much wealth you’ve accumulated, there is always going to be someone out there who has less than you, and wants to take it from you.
That’s why an important part of your Living Legacy is Asset Protection.
And it’s why we share the Asset Protection strategies from one of the top asset protection attorneys with our members.
He helps our group discover ways to protect yourself … and your assets from the unexpected surprises that happen in life… things like lawsuits, accidents, death, and divorce.
This is a “must have” piece of everyone’s financial puzzle no matter how many assets you have to protect.
And in case you’re thinking that asset protection is only for the rich…
Let's Dispel a Common Myth
A common myth among the middle class is that rich people can somehow legally protect their wealth, and then go out and screw people over (and get away with it).
It doesn’t work that way.
If you are acting fraudulently, a judge has every right to “pierce the corporate veil” and come after your personal assets.
So “asset protection” isn’t about avoiding the consequences of fraud.
It’s just a smart and savvy legal tool to protect yourself from the common misunderstandings and sour grapes that inevitably happen in life. Especially in the business world.
And Robert Kiyosaki’s bankruptcy is a perfect example.
He does not appear he engaged in fraud. He and a partner had a business disagreement. The partner won.
But because Rich Global was set up as a separate entity, Kiyosaki’s personal assets were protected.
Your Own Personal Asset Protection Plan
If you don’t have an asset protection strategy in place, you need to get one in place soon … especially if you are running a business or thinking of starting a business.
Robert Kiyosaki had enough foresight to protect himself right from the start. He starts every new business as a separate entity, and is smart enough to run his businesses’ affairs through multiple companies
But as you’ll find out, it’s not just businesses that need asset protection. You do, too.
In order to protect yourself, you first need to understand that this is a highly specialized field, so you’ll want to find an attorney who focuses solely on asset protection.
Here at LLA, our Rolodex of contacts (that you gain access to with a Living Legacy membership) comes complete with our personal asset protection attorney and entity strategist who can get you off on a great start, and help you figure out your next plan of action.
Today, more than ever, it is clear that if you want to grow long-term wealth and reach your financial goals, you must take proactive steps to ensure that you’re keeping what you earn and not allowing predators to set you back or wipe you out completely.
To Your Success The Living Legacy Association Group
