We often hear or have read the popular quote, “A goal without a plan is just a wish.”
This message centers on the importance of carefully arranging a set of activities to achieve an aspiration with readiness, lesser risks, and optimal use of resources. From aiming for a certain investment objective or as simple as going on a quick weekend getaway requires a plan – be it quantitative, qualitative, or both.
Same goes for managing your wealth.
Wealth planning is a comprehensive approach to managing financial resources that focuses on accumulation, preservation, and transfer of wealth. It involves strategizing various aspects of personal and family finance that includes investment management, risk mitigation, and planning for taxes, estate, and even retirement.
Why plan your wealth?
It provides a structured path to financial stability and prosperity that will allow you to confidently fulfill your aspirations for yourself, your loved ones, and for the rest of the people who matter to you – so all of them can continue living well in the future.
Without a plan to execute, you, and even your family members, may be burdened of risks such as of incurring unexpected big expenses, inaccessibility of assets, and piles of tax liabilities to pay.
Kickstart your plan: Divide and conquer.
Wealth planning is a holistic approach to growth and legacy. This process involves developing a strategic plan that encompasses various elements to ensure a holistic and effective management of your financial assets, resources, and legacy. To give you a head start, your main wealth plan should be classified into different sub-plans such as for:
- Personal finance
- Health
- Retirement
- Estate or legacy
- Taxes
- Charity or giving back
You can add or lessen the list depending on your objectives. However, keep it manageable so it won’t overwhelm you.
The right financial solution for every plan
Seems complicated? No, it’s just simply organizing and clarifying your intentions for you to know what financial tool/s would be suitable to help you in achieving your goals – and ultimately your overall wealth plan. Just like there’s a perfect wine to match what you will eat and enjoy the moment, right?
For personal finance and investments, bank products such as time deposits typically let your money grow on your own terms with reliable growth through high interest, flexible terms, and renewable options. These are safe and secure as deposit products are insured by Philippine Deposit Insurance Corporation (PDIC) up to PHP 500,000 per depositor.
Banks also offer financial instruments like Unit Investment Trust Funds or UITFs that are managed by asset management professionals who will make the most out of your invested money. As an investment vehicle, you should know your risk profile and time horizon by taking a Suitability Assessment to ensure the investment matches your capacity and ability to take risks. While they aim to grow in value, investing in UITFs comes with risks of decline in value during scenarios of negative market condition. Unlike deposits, these investments are not insured.
For plans that involve managing risks such as health, retirement, estate management, and charity, life insurance products are suitable solutions to consider.
A key feature of life insurance is its guaranteed death benefit, or the cash proceeds given to the beneficiaries at the time of demise of the policyholder or the insured person. The death benefit feature and its coverage period vary depending on the type of life insurance availed.
If your primary objective is to cover for estate taxes, unexpected expenses, and wealth transfer to heirs, suitable life insurance policies that you can consider are:
- Whole life insurance offering lifetime protection and accumulation of cash value; or
- Investment-linked insurance bundling the benefits of insurance coverage and potential growth of account value depending on the performance of the fund selected.
Confidently navigate your inheritance planning journey
If you’re at the stage of life where your wealth-building years are behind you and you’re preparing to pass on your legacy or pamana, you may find that the journey is more complex than you expected. True enough, the journey of inheritance planning and wealth transfer can often be rigorous and emotionally taxing. From settling estate taxes to ensuring a smooth distribution of assets to heirs, the process can place a significant burden not only on you but also on the very people you wish to provide for. Instead of a peaceful transition, the situation—especially in most Filipino families—can easily become complicated by legal challenges, transfer delays, and even potential disputes among heirs.
This is why AXA, a global leader in insurance and investments, wants to ensure a seamless transfer of pamana and help legacies live on for the next generation through its newest inheritance planning solution, AXA Legacy Steward. This insurance product aims to help protect your pamana for your loved ones with the following features and benefits:
Inheritance Optimization- Secure your heirs with a death benefit of as high as 250%¹ of the total premiums paid to cover estate taxes, wealth transfer costs, and other expenses in the future. You’ll also get lifelong annual cash benefits you can use anytime or allow to accumulate within the policy.
Intentional Wealth Distribution-Have a clear and tax-efficient² inheritance plan in place with a life insurance that helps distribute your wealth exactly as you intend.
Access to Inheritance Planning Support- Get expert guidance and resources for effective planning of your pamana through the following:
- Financial advisors who are certified in trust and inheritance planning
- Estate assessment using AXA’s Tax and Expense Calculator
- Option to be referred to a law firm from our curated list³ for estate consultation
Tapping a partner as you build and execute your wealth plan
Seeking a reliable and expert professional is a critical action point in wealth planning. Your trusted bank partners and insurance financial advisors are equipped to help you understand these financial solutions and how these can drive to successfully realizing your wealth objectives.
Know you can have different approaches and strategies on how you want to build, pass, and preserve your wealth. If you want to ensure a smooth transfer of your pamana to your loved ones talk to an AXA Financial Advisor today, or visit Legacy Steward to learn more.
Remember, turn your dreams into reality. Get started with your wealth plan now!
¹Depends on the Insured’s age at the time the policy is issued.
²Tax exemption only applies to policies with irrevocable beneficiaries, or to policies with revocable beneficiaries that remained unchanged.
³The list of law firms provided is not exhaustive and subject to change. We do not guarantee or endorse any specific firm. You are advised to conduct your own due diligence when choosing legal counsel. All legal consultation fees must be paid from your personal account and will be billed directly by the law firm; these are not included in the product premium. Access to legal consultation is entirely optional.
