"I am honored to share with you my 40 years of insights and discuss the important concepts of life insurance and family legacy planning."

— How can a family protect its assets and pass them down through generations?

Singapore and Hong Kong are both highly developed financial hubs, representing some of the top life insurance companies and fund managers in Asia, and even globally.

The life insurance products and premiums offered by Singaporean and Hong Kong insurance companies are among the most competitive in Asia and even worldwide.

In Singapore, the premiums for insurance are lower, about 20-30% of those in other emerging Asian markets. At the same time, the quality of the products is excellent, with a well-established legal regulatory system, a tax-free environment, and transparent product structures and contracts. The average life expectancy of residents is 85-86 years.

In addition to the fierce competition among insurance companies driving premiums down, Singapore also has a sound regulatory and legal framework to protect policyholders. The law oversees everything in this land.

Furthermore, the Singapore dollar remains one of the most stable and strongest currencies in the world over the past 50 years. Due to its strong financial reserves (around 1 trillion in reserve funds) and an efficient, clean government, Singapore is respected as a globally trusted financial center.

Next, let me share an example:

Let’s consider the market value of a company. If the total assets are 100 million, liabilities are 30 million, and the net assets are around 70-80 million, we can imagine that the company's net profit is 20 million. If it goes public, the company could be valued at 200-300 million.

Every company has an excellent and key entrepreneur. Why are these companies successful? Perhaps because the entrepreneur has vision and foresight, specialized industry knowledge and connections, and exceptional leadership and innovation. Perhaps because the entrepreneur is a spiritual leader or interpersonal expert capable of bearing risks, with the trust, reliance, and respect of others.

Imagine if the entrepreneur were to pass away, fall critically ill, or become completely disabled, what would happen to the company's value?

Without the entrepreneur, the company's market value would be severely impacted, and it would face significant risks and challenges:

• Creditors might consider reducing or minimizing debts due to the uncertainty surrounding the business’s survival.

• Banks might re-evaluate the debt rating until the company has stable liquidity and profitability.

• The company would lose leadership, entrepreneurial vitality, and stability.

• Successors are often not fully prepared to take over: managing various relationships (clients, suppliers, banks, etc.), industry knowledge, leadership skills, and so on.

Many businesses plan for leadership succession, but building a strong leadership team takes time.

In conclusion, an unexpected event involving the entrepreneur could dramatically damage the company’s value.

In such cases, the solution is life insurance.

The best insurance structure is to use investments to pay premiums. For example, a premium of 500,000 per year with a coverage of 50 million.

The 500,000 premium is equivalent to a deposit. Through global investment, after 20 years, the policy’s cash value is estimated to reach 15-20 million. At this point, the profit exceeds the investment, and it is completely tax-free.

Upon a claim, the business would receive a 50 million capital injection. This not only clears the debt but also allows sufficient time with liquidity to find a successor.

Now let’s look at another example with an ultra-high-net-worth individual.

How can we protect personal and family assets?

In this example, the entrepreneur owns 50 million in real estate (including 25 million in debt), 50 million in protective investments, and 25 million in private equity. His business is valued at 100 million (including 25 million in debt). If the entrepreneur were to pass away, the policy would provide 50 million in liquidity for the business.

Life insurance can serve as liquidity, offering timely asset protection. Similarly, premiums are invested in a global portfolio, with returns gradually exceeding costs, all tax-free.

We need to understand the concept of wealth accumulation. Wealth is not created overnight; it grows over time through cycles.

If I give you one penny and double it every day for 30 days, would you work with me?

1 2 4 8 16 32 64 128 256 512
— On the 10th day, the penny would become 5.12 USD.

If we use 5 as an example: 10 20 40 80 160 320 640 1,280 2,560 5,120
— On the 20th day, it would become 5,120 USD.

Using 5,000 as an example: 10,000 20,000 40,000 80,000 160,000 320,000 640,000 1,280,000 2,560,000 5,120,000
— After 30 days, one penny would grow to over 5 million USD.

Wealth requires time to accumulate.

If a company grows at an annual rate of 20%, it will double every 3.6 years. But with an investment rate of 2-3% (pension or bank deposits), it will take much longer.

Warren Buffett's investment of 100,000 became 500 million after 35 years. According to insurance companies, the goal of a diversified investment portfolio is to achieve 1-2% of the returns that Warren Buffett or Peter Lynch earned, which amounts to 5-10 million.

The growth of family wealth requires a very long time.

At 70 years old, if I want to do something for my children, grandchildren, or even the next generation, I need services that can transcend generations.

Franklin Meidici Family Office is a company that helps in passing down family wealth.