Creating an LLC

[Richard Campbell Jr]

Happy Memorial Day Weekend!!!

I own two investment properties and I don't have an LLC started yet. I plan on creating one but I had a conversation with my sister (she is a commercial litigation lawyer) and she said I should not create just one LLC for all my investment properties. She stated that each property I own should have its own LLC and all of those properties should be covered under one "central" LLC. I wanted to know if having one LLC to cover all my properties is sufficient or should I create a new LLC for every property I own. Thanks!

[Bryan O.]

@Richard Campbell Jr also keep in mind your costs. How much is an LLC to maintain in Pennsylvania? I'll just throw out $100 as a number. Do you want to pay $1,200 of your cashflow for every... single... property? But wait, there's more! You will also be paying extra to a bookkeeper to keep track of all those different account. Then you'd better be vigilant that you don't use money from one to the other. Does any of that make sense?

I think that until you have something worth protecting, there's no point in spending all your growth money on not growing. For the first couple of properties I would recommend you get a good umbrella policy for $250/year and one LLC. Get super sexy with all that stuff once there is something sexy to protect.