Let me introduce you to Scott Smith, a new breed of real estate attorney with a great sense of humor and a gift for simplifying the complex. His Austin startup, Royal Legal Solutions, has a different take on protecting your assets including real estate investments and already serves thousands of clients across all 50 states.
As a former litigation attorney, Scott has a deep understanding of how lawsuits really work. More importantly, he is a real estate investor himself, with property in 10 states. Now he’s sharing his information with the world and is committed to helping other real estate investors protect their futures.
Who is Scott Royal Smith?
At the heart of it all, Scott is a guy that likes to solve hard problems and then show people the solutions he’s found. He can then connect with people in an empathetic way and help them make positive changes in their lives.
Spiritual development is very important to Scott, the biggest KPI that Scott focuses on is his sense of well being and how he shows up in the world. Awareness of your own being is the only way to connect with other people. It doesn’t matter how great your ideas are unless you can connect with what’s true with somebody else.
Scott’s mindset was passed down by his mother who taught him that there are two types of people in the world, people who think things happen to them and people that think that things happen for them. When life happens for you, you have a responsibility to reflect on and grow from your experiences.
Why did you choose to become an attorney?
Scott started his career as a litigator suing insurance companies with the overall goal of trying to change the industry. One thing he found along the way was you have to be really careful about what you want because you just might get it, and if it turns out you don’t like it you’re in trouble.
Scott had been investing in real estate at the same time and was making more money investing than he was in his career, so he just decided to make the switch on what he was focusing on. It was in the process of learning the real estate investing ropes that he encountered a bunch of interesting problems that a lot of people were constantly asking about and that was the seed for Royal Legal Solutions. Now he teaches people how to make complex real estate investing problems simple.
Scott doesn’t consider himself an attorney now. He may hold a law license, but what he does now is focus on helping investors.
From a business owner perspective, what are the things that we should be thinking about but are overlooking right now?
Real estate investing is also a business once you get to a certain point and protecting your assets becomes absolutely crucial. The things that impact business owners will also impact real estate investors.
The first step is to tap into any established lines of credit you have. Long term secured debt is ideal with low interest rates. Pull out as much cash as you can because we don’t know what’s going to happen with liquidity markets and they are probably going to seize up. If they do and you have cash, you will have money on hand to take advantage of opportunities that come up. If it doesn’t happen the worst case scenario is you pay a few percentage points.
Once you’re in a liquid position, just sit on the cash. The second major risk in protecting your assets is facing a lawsuit. When economies go down, people start to look for ways to use the law to take other people’s stuff. Taking steps to put anonymity into your assets is a good way to increase security. Insurance is only your first layer of protection, creating a system that anonymizes your assets and keeps them all separated is much more effective.
The third step is to figure out your estate planning and making sure your family is taken care of in the event that you die. It’s important to be strategic about estate planning because you don’t want the government making those decisions for you. Without a plan in place, your wealth can get locked up without your family being able to get access, possibly for months or longer.
What if you don’t have lines of credit, how should you be protecting your assets?
There are ways to take all the money out of your retirement account without paying penalties. Take that money and all your various retirement accounts from other employers and roll them into a Solo 401(k), once that’s done you can loan yourself back up to half the value without a penalty.
Scott has also created a network of investors to remove the risk of people doing mutual loans to each other that essentially allows people to access all the money in their retirement accounts.
All these steps are just things that you should have been doing already, ways to shore up your life. Incremental benefits are going to be things that allow people to survive this crisis because there is no silver bullet right now.
Connect with the smartest people you can find who are also high action people. The people who are taking lots of action to solve problems are the ones who are going to survive and thrive. The people just talking are not going to make it. If everyone is talking about something, it’s pretty much guaranteed to be wrong. Remember, if the popular opinion were right everyone would already be rich.