Legacy Planning and Wealth Transfer

You’ve worked hard in building up wealth all your life and now have the desire to pass it efficiently to your loved ones. The issue most of us see is that many countries around the world have inheritance taxes and some are as much as 40%. Which quite simply means that after 2-3 generations of this wealth being passed on, there is nothing left.

Efficient tax planning is only one item where a death benefit can compensate for these inheritance taxes. Moreover the single most powerful characteristic of an insurance company is an efficient pay out of a death benefit to beneficiaries.

In fact, the space has evolved so much that depending on the size of your wealth, a trust may not be needed, saving costs.

However if your wealth is significant then wrapping the insurance policy within a trust to pay out according to your letter of wishes is a smart move and what the rich do.

Legacy planning is paramount and needs to be planned early to have the best chance of success.

Mr. Chan, owner of a listed company has always desired to transfer HK $100 million to his son after he passes away. The original plan was to provide this from his company where revenue would be able to cater for this.
However, fluctuations in the market and a recent pandemic has placed a question mark on this desire.

Solution

Through our service, we are able to provide a solution and find the bank as his partner to investment into a very safe instrument that only grows and compounds year after year. The bank looks at collateral and the underlying and will never intend to lose its own principal. There are only a few setups that can apply lending, such as premium financing, where upto 80% of an insurance policy is financed taking advantage of historical low lending rates.

With an insurance company as a pseudo guarantor of steady compounding year on year and an accurate forecast of future commitments, this regulated setup has been a solid strategy for the rich and executives alike!