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Succession | Intergenerational Wealth Transfer | Legacy Planning

Bespoke business succession planning 

Wednesday, January 05, 2022

Bespoke business succession planning 

Client Results

$30 Million

Total value of business to be inherited 

2 Heirs

Generational transfer to children

Background

60-year-old client, Anna, ran a successful business with one of her sons.  

As she approached retirement and started to consider her estate planning, she knows that she wants to leave 100% of her business to her son. However, she also has a daughter who works as an artist in New York and Anna was worried that her daughter won’t receive her share of the inheritance.   

Anna’s estimated net worth of the business was $30 million. While she knew control of the business was best passed to her son, she worked hard to build the business for both children. 

The solution  

Anna purchased a Whole of Life policy with a death benefit of $30 million using a single premium of $13 million.  

Since most of Anna’s assets were tied to the business, we advised her to pursue a premium finance strategy instead of funding the entire premium upfront. Doing so enabled Anna to use her available cash flow to incept the policy, deploying only 15% of the premium and financing the rest at a favourable rate. She was to use the dividends received on assets to fund the premium finance cost throughout.  

She now had the flexibility to utilise excess funds during the premium payment term and, most importantly, on her death, both children will receive an equal share of the company.  

On the topic of inheritance, our advisers also curated a thorough inheritance plan to ensure the smooth transition of wealth upon Anna’s passing. Our trustworthy partner firm ensured her will was up to date, while our specialist inheritance and estate advisers created a bespoke financial plan that protected and grew her wealth while leaving a legacy behind for her children.  

  

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