What Legacy Planning Means To Me
This post was written for www.hnworth.com, a site targeting high net worth individuals in Singapore.
Have fun reading !
********************************
I have not sat down and wondered why I have a new set of friends these days. Whatever happened to my old mates and buddies whom I only connect with over Facebook, without seeing them for months on end ?
Well, our lives have drifted off in different directions over the years as our life and family situations changed.
For, a trend I note of late is that many of my old friends have embraced the wonderful life of late parenthood which makes me very happy for them. Yet my own situation with a teenager who just went on his first date does not give me a lot in common by way of family activities though I do, on occasion, enjoy spending a few hours with the screaming kids demanding attention just to reminisce on life a decade ago.
I like to think that I am fortunate, to have started the parenthood journey earlier than some of my friends, some of whom may be unfortunate, though they would not like to think so, to have started to have a second time shot at the affair.
But I am lucky that I have to only worry about the legacy planning aspect once, so far with fingers crossed.
Yes, legacy planning. Something no one would really think about when the cherubic little darlings are running amok. Fortunately, from personal experience, they do wear you down a little and get uglier than when you first laid eyes on them, it will hit you one day, I believe sometime between when they are 7 to 9, that it is a venture worth considering.
Thus, I was suckered into the universal life plan, as many others are. For that is the starting point to the whole concept (as far as private banking is concerned) of legacy planning.
Unfortunately for me, I have only the privilege of the acquaintances of a billionaire and a billionaire-in-the-making in the past 6 months, to come to the realisation that it is not what legacy planning is about which is, a little late but, nonetheless, better late than never.
I have put aside US$ 1 million for the kid in the universal life plan a few years back. It is much less than what some friends have done, US$4 to 10 mio for each kid, but it is probably more than the average man on the street, I would suspect, however tempting it was then, to be told I was qualified, for my state of unnatural good health (despite the odd vices) that I could easily stretch it to a much larger quantum if I wished.
Legacy planning is not, as the media suggests, about the insurance or annuities or the bonds despite the propaganda out there and the establishments would have us to believe.
“life insurance can be considered as a supplementary component to the straight provision of assets as part of an inheritance or legacy plan.
Firstly, life insurance benefits are payable without going through the court claims process, therefore allowing the beneficiary to claim the compensation amount to meet any urgent needs.” –http://business.asiaone.com/news/life-insurance-vital-part-legacy-planning
I think the person has been poorly advised on universal life. First of all, universal life is a non-participating life policy and there is something like a base crediting rate which is guaranteed. Secondly, if he is concerned about policy lapsing, he can look around and buy the universal life that offers a no-lapse guarantee- a bit more expensive but it will solve his concern. Maybe he should get a better banker or insurance sales man. I don’t think he knows how universal life works.