Archive for the ‘Life’ Category
Singapore Sits Moodily Atop Wealth Pole
This is an article that appeared in The Business Times. We, as Singaporeans should be appreciative that we live in a wealthy and comfortable environment. Compared to the world population, which is exceedingly poor, Singaporean middle class is considered well-off.
Read the full article here.
I do understand the discontent and anxieties of the middle class too. On one hand, in monetary terms, our generation have huge salary and wealth increase from our parents’ generation, on the other hand fierce competition for space, opportunities in a small crowded island means real standard of living have not improved very much. I believe many Singaporeans dream to have a relaxed and comfortable life. However, as the situation is, the consensus view is that if a working adult does not strive doubly hard, he/she will find himself/herself at the bottom of a huge population of wealthy residents, with difficulty in purchases such as a home.
Overall, I think there needs to be a change in mentality in what Singaporean pursue in life. We have always looked to Switzerland as a country to be envious of. Perhaps, more effort should be spent thinking about how to mould a comfortable a stress free society.
Regrets Of The Dying – Bronnie Ware
I am sure some of you have read this before. It is a short article by Bronnie Ware.
“For many years I worked in palliative care. My patients were those who had gone home to die. Some incredibly special times were shared. I was with them for the last three to twelve weeks of their lives.
People grow a lot when they are faced with their own mortality. I learnt never to underestimate someone’s capacity for growth. Some changes were phenomenal. Each experienced a variety of emotions, as expected, denial, fear, anger, remorse, more denial and eventually acceptance. Every single patient found their peace before they departed though, every one of them.
When questioned about any regrets they had or anything they would do differently, common themes surfaced again and again. Here are the most common five:
1. I wish I’d had the courage to live a life true to myself, not the life others expected of me.
This was the most common regret of all. When people realise that their life is almost over and look back clearly on it, it is easy to see how many dreams have gone unfulfilled. Most people had not honoured even a half of their dreams and had to die knowing that it was due to choices they had made, or not made.
It is very important to try and honour at least some of your dreams along the way. From the moment that you lose your health, it is too late. Health brings a freedom very few realise, until they no longer have it.
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Case Study – Universal Life for Estate Preservation.
In event of a death of a wealthy patriarch, his estate has to be carefully administered. 80% of the time the time a passing of a patriarch is not anticipated and his/her assets not in the ideal state to facilitate either a transfer into an estate or division among beneficiaries.
Let us take a simple example of wealth of a deceased male HNWI, Mr Seah, of age 56 as such: $4.5 million worth net investments in 4 different businesses, 2 restaurants, a trading firm and a logistics company. 2 properties worth $3 million, one of which is residence of the family, and $0.5 million in cash equivalent. However, at the time of passing, Mr Seah is actively involved in the running of 3 of these 4 companies. He had taken out a personal guarantee on $3 million dollars on capital loans, trade and credit lines in total. The banks will require either a repayment of the loans or another guarantee on the original loans. The children, 2 sons are just 22 and 25 years old and fresh out of college. Though they are fully independent, neither of them are involved in the businesses as they started working in big corporations gaining experiences and exposure. As such, it is likely that the banks will not find the personal guarantees of them sufficient. Either that or sell their residence and the other property. If no alternative is found, the estate will have to sell of parts or full of the businesses for repayment of the loan. That will be a pity, as the restaurant and the logistics company is just about to take off after running for 3 and 5 years respectively.
Invest Fair 2010 Experience
I went to the Invest Fair 2010 at Marina Bay Sands last Saturday. The event was jointly organised by ShareInvestor and The Business Times. My purpose there is feel the atmosphere, find out what people are after and just get a little exposure to this side of financial product sales.
As I walked in, was approached constantly by promoters speaking to me about what they are promoting. Not surprising, considering this is a free event and the exhibitors and participants paid the organizers to have a booth there. Main aim is to do promotion and sales.
Case Study – Universal Life Insurance for Estate Distribution
Universal Life Insurance can be used for dividing your estate equally as was done in this case. The same solutions apply for situations where other single major asset, such as property, forms the major part of your estate.
Mr Tan is approaching 65 and wishes to do some estate planning. His estate consisted of a business, valued at $8 million, a landed property worth $2.5 million and $2 million in cash. Mr Tan has a wife, two sons and a daughter. He is semi-retired from the business and handing the business over to the eldest son, who is the only one interested in running the business.
He is not worried about the wife, should he pass away, as she is close to the children and has ample savings. However, he is worried about how he can distribute the estate equally. The main worry is the business. Should he hand major ownership of the business to the eldest son, it will not be fair. Should he distribute the business equally, the two youngest children will be more interested to sell the business. This will dilute the ownership of the business and disrupt expansion plans the eldest son has. Secondly, it will be difficult to split the inheritance of the landed property.
Case Study – Universal Life Insurance for Estate Creation
The following is a real life case study.
Mdm Hayashi is 60 years old. She was the second wife of her deceased husband, late Mr Cheong, who was also her second husband. She married Mr Cheong when she was in her late forties and Mr Cheong in his early fifties. She has 2 adult children still in Japan from her first marriage and Mr Cheong has 2 adult children from his first marriage living and working in Singapore.
When Mr Cheong passed away 3 years ago, he left in his Will 55% of his assets to Mdm Hayashi and the rest to his 2 children. Mdm Hayashi’s current networth of $5 million is almost fully from this inheritance. Mr Cheong’s 2 children are both doing really well financially. However, it is Mdm Hayashi’s wish and the step children’s expectation that upon Mdm Hayashi’s passing, most of the wealth from Mr Cheong should be inherited by the step children instead of Mdm Hayashi’s Japanese biological children.
