OCBC Life Goals

Mr. Chan's Journey

Wealth Transfer Case Study

Let the fruits of your labours last for generations.

Wealth transfer is all about securing a smooth transition of wealth to your children, and ensuring a solid foundation to build a brighter future for generations to come.

While we all have our unique goals and circumstances, at OCBC, we firmly believe that there's one thing that should never be passed down through generations: debt. Thus, our approach begins with managing debt, and follows on to the specific needs of every customer.

The case of Mr. Chan

Mr. Chan, a businessman in his early fifties, had a lot of worries on his mind. He had three children aged between 15 to 21, all still in school, and he was relying on investment properties for his own retirement income as well as assets to pass on to his children.

Mr. Chan's biggest concern was his debt liabilities – multiple property loans that he did not wish to burden his children with. In addition to managing his debt, he also wanted to build a substantial estate to secure his children's future. However, he was worried that the children were too young, and should anything happen to him, they wouldn't be equipped to handle large sums of wealth.

Our advice: Start with the essentials

With a clearer understanding of Mr. Chan's financial situation, concerns and aspirations, we advised him to begin by covering his liabilities with a universal life insurance plan. It was also important to understand that his liabilities went beyond his mortgages–potential education costs for his three children would be substantial too, for example.

Addressing these liabilities with a universal life policy that would pay out a lump-sum upon his demise, Mr. Chan could then use the income generated to build his children's education fund and to pay off any outstanding debts on his properties.

Once we had ensured adequate coverage for Mr. Chan's liabilities, we looked into ways to preserve his family's lifestyle for at least five to seven years after his demise. This would provide enough liquidity for his children until all of them could graduate and begin their careers.

For this pot of income, we recommended that Mr. Chan consider life policies like the PremierLife Generation which allow him to specify the nature of the pay-out. In his case, a monthly pay-out would be helpful to allow his family, especially the young children, to better manage the money and fulfil their primary needs.

Top recommendations:

To sum up, here are some of our handpicked recommendations for those looking to ensure a smooth transfer of wealth across generations:

  • PremierLife Generation

Enrich your mind