We are a nation who runs over the little guy in an effort to push to the top. A great example, look at the state of our housing market and economy. The most vulnerable of our society are the people who are the highest risk of foreclosure, short sale, and homelessness. Some of these people put themselves in this position through poor decision making and lack of education. I am not talking about basic school education, rather financial literacy, understanding basic contracts and protecting one’s self and family from those who seek to take advantage.
Some people in today’s world will walk over you if it means they can get ahead. When I think about people using circumstance to their advantage, it reminds me of the hot coffee lawsuit brought against McDonalds 15-20 years ago. A customer drove through the drive-thru of a McDonalds and ordered a coffee. Shortly after, she spilled the coffee on herself and proceeded to sue McDonalds for serving her hot coffee. The outcome? The customer won a large sum of money, coffee cups everywhere had the word ‘hot’ added to it, and future coffee consumers get lukewarm coffee. I don’t want to serve lukewarm coffee to my customers, or worse, lose what my family has worked hard to achieve.
During the lawsuit specific employees who served the hot coffee were not affected by the outcome. Why? The structure of the company protected them.
What if a customer decided to sue your company tomorrow?
Would your personal assets be protected?
Could you be personally liable for any “large monetary awards” ordered by our judicial system?
If you are self-employed, a great way to protect personal assets from business lawsuits is a clear separation of business and personal through the formation of a corporation. There are several types of corporations, and choosing which type is appropriate for your situation requires a hard look at the facts of the company.
Are your assets protected from sucky people?