Recently many friends ask me what exactly I create for my clients through the unique financial planning process mentioned in the scope of service. Therefore I decided to write and publish some classic example of my own clients which I hope it helps to illustrate. Some key data and information are intentionally modified so that their identity and privacy are well protected. I would appreciate all of your feedbacks and comments, and welcome for discussion. Should you have any friends facing the similar situation, please feel free to share, or make a personal introduction. 

Cheers
Gifford

Background Information.

Age: 38

Occupation: Business owner

Human needs: Growth, Significant

Objective: Asset protection from future creditors. 

Real objective: Provide a stable financial certainty to family. Minimise potential liability in case of business downturn. Safeguard asset against creditors.

Concerns: Liquidity. Business Downturn. Liability and personal guarantee. 

Risk: Business debt ($20,000,000) affects family life. No other financial investment or engagement except operating business. 

Resources: $8,000,000 equity value ($28,000,000 asset valuation).  $1,000,000 family income each year.

Real Resources:  $105,000,000 Business turnover. Time. Married status. 

Strategies based on human needs: 

1. As long as the client wants to grow all the time, he will not satisfy & prepare a plan B with his significant traits. Therefore, setting aside of certain amount of capital is necessary for the family well being in a long term. 
2. Zero for the whole strategy since he is not able to deploy a large amount of asset at once. Build the financial ark by small amount of contribution each year, balancing the liquidity and flexibility. 
3. Simple asset separation reduce the correlation between high risk and low risk asset.
4. As he signed personal guarantee with banks for further financing, procedure should be done carefully with professional advice to make sure validity.

Implementation of holistic planning: 

1. While the business is capital intensive and requires liquidity, setting up a subsistence trust is not suitable for this client. Therefore, by making use of the married person status ordinance, he can enhance his protection and safeguard his family asset by purchasing a life or endowment insurance policy with his wife as beneficiary. This could protect the insurance proceed from the creditors just in case. 
2. Yearly contribute around 0.4% of turnover, i.e. $420,000 into annuity policy, for 10 years. At year 11 it generates $350,000 lifetime income to his family, totally tax-free. If he chooses to retain the asset inside the policy, the money is well-protected agains creditors because it’s purpose is for protecting his family. Such tiny amount will not affect liquidity. 
3. Re-arrange potential liability asset like car, and high risk business into separate corporate entity. Personal holds only cash & insurance policies. 

Gain & Benefits after planning:

1. Lifetime passive income creation other than business active income, which creates multiple streams income for his family. 
2. Capital reserve for family in case of insolvency. 
3. Save over $500,000 cost of setting up a trust. 

p.s. I am your plan B. You can always earn a lot if everything is well. The only question is, if something bad happens, who provides you the money? And thats what I stand for.

#assetallocationplanning #businesscontinuity #universallifeinsurance #riskmanagement 

你可能唔知道，在遺產策劃的角度看，只運用保險工具創造大筆現金遺產，還是未足夠保險。

舉例來說，如有一對夫婦不幸同時於意外中喪生，這對夫婦未成年的小孩雖然獲得保險公司上千萬元賠償，卻可能無法享受到應有的保障，因為小孩的法定監護人領走了保險賠償之後，可能將小孩丟給其他親人照顧，從此不聞不問、一走了之。 

如果父母生前將其購買的保險加上信託的保障，若不幸身故，保險賠償將撥入信託戶口，由受託人統一管理。即使受益人還未成年，也能夠善用龐大的保險賠償，在他們成長的過程當中可以得到合適的資助，並可防止不肖親人不當挪用，保障未成年子女的利益，亦解決子女不當使用的問題，因為立託人可以訂立財富運用的條件，如進修創業可以提款，而不能購買名貴跑車等。

一直以來，信託被視作富人的專利，身家要有過億，這實際上是個假像。我遇過不少的信託基金，立託人的身家只有一千多萬。更重要的是，妥善運用保險並透過遺產信託的形式，一千萬的財富可以倍增至四千萬的資產之餘，信託於身故後即時生效，充份保障了家人的未來，更破除“富不過三代”的魔咒。

如何做到？容後詳談。