60% of Singaporeans also don’t have conditions attached to their plan.
When Singapore’s high net worth individuals, or HNWIs, were asked whether they have a full wealth transfer plan in place, only around a fifth answered in the affirmative, notably lower than the Asia-wide average of around a third.
In fact, Singapore’s HNWIs are the least prepared when it comes to having comprehensive wealth transfer plans amongst all Asian countries surveyed, according to RBC Wealth Management’s new Asia Pacific Wealth Transfer Report. This rings alarm bells for wealth management experts who warn that simply having a will in place may no longer be adequate preparation for HNWIs.
Tho Gea Hong, head of wealth management Southeast Asia at RBC Wealth Management, explained that with HNW families spreading their wings to take advantage of opportunities around the world, their wealth may be spread across multiple jurisdictions or they may have inheritors living in different countries. This tends to complicate the transfer of wealth since transferring cross-border assets is not as straightforward on onshore assets.
“Many are delaying putting in place a proper plan as it is not as straightforward and they do not have precedent knowledge on how to structure it. Some also avoid it as they do not want to think about their eventual demise.” said Hong.
The report also noted that a higher percentage of HNW Singaporeans–60% compared to 36% in Asia–also have no conditions attached to the transfer of wealth. Hong said Singapore’s relatively high percentage mirrors more closely to the West, where 74% of families do not have any conditions attached to the transfer of wealth.
Singapore respondents also do not make the next generation aware of their wishes and plans for transferring their wealth. Hong said this could leave Singaporean heirs “somewhat adrift” when the time comes to transfer wealth, so early discussions often prove beneficial.
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