You cannot normally encumber ERISA-qualified plans because of the spendthrift provisions, but then again there would be no need to protect ERISA-qualified plans. It is different with non-ERISA plans. To the extent there is exposure for the plan, the retirement account holder’s interest can be encumbered. Therefore, encumbering an unprotected retirement account is a worthwhile strategy in some instances. In a few instances, we combined the international LLC-IRA strategy with encumbering the investments in the LLC. It builds a strong defense.
