Why Heritage Wealth Planning Is More Important Than Ever?

Nov 25 2020 | 4 min

Without a financial strategy, many affluent families can miss on long-lasting wealth. Without effective planning, family wealth disintegrates over time as it spreads over a growing number of family members. An estimated 70% of affluent families lose their wealth by the second generation and 90% lose their wealth by the third.

Wealthy families in Saudi Arabia and throughout the region face many challenges:

wealth challenge chart

1. Family Wealth Disintegration

As the founder ages, the pool of wealth is subdivided among a greater number of heirs

2. Pressures on Sustained Living Standards

The price of luxury living extremely well has increased 10x over the last 40 years.

3. Risky Investment Decisions

Poorly planned investments can rapidly erode assets in a short period of time.

4. Maturing Core Business

As the business matures, the company pays dividends to shareholders rather than reinvesting in the growth of the company.

5. Tax Inefficiencies

Different types of taxation across jurisdictions can cause a significant drain on assets if not correctly managed.

6. Lack of True Diversification

A lot of family wealth is invested in local assets, including local real estate and stock market, which often leads to over-exposure. True diversification can only be achieved through investment in non-correlated asset classes on a global basis.

The children and grandchildren of wealthy individuals who grew up without financial worries often neglect financial planning and investment as they grow older. But families who create a financial strategy with expert advisors can achieve financial security for generations. Thanks to the magic of compounding returns, forward-thinking families can receive generous incomes while they continue to grow their wealth over the long term.

The most effective wealth heritage planning advisors keep the source of wealth in a centralized portfolio. This way, multiple family members can benefit from a generous income, while the value of the overall wealth is preserved over time.

Heritage Wealth Planning is a common way for affluent families to secure a financial legacy for their children, grandchildren and beyond. At The Family Office, our team of experts consider the income and lifestyle requirements of the whole family and create a tailor-made heritage wealth plan for you.

We’ll find the balance between the risk needed for your goals and preferred standard of living. Using our network and decades of experience, we create tax-efficient, internationally diversified portfolios, so your wealth can last and grow for generations upon generations.

To start building your lasting family wealth, speak to your financial experts today.

 

Disclaimer:

This presentation is provided to you by The Family Office Co. BSC(c) (“The Family Office”) for informational purposes only, and contains proprietary information that may not be reproduced, distributed to, or used by, any third parties without The Family Office’s prior written consent.

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The Family Office makes no representation or warranty, express or implied, with respect to any financial projection or forecast With respect to any such projection or forecast delivered or made available by or on behalf of The Family office, it is acknowledged that (a) there are uncertainties inherent in attempting to make such projections and forecasts, (b) the investor is familiar with such uncertainties, (c) the investor takes full responsibility for making its own evaluation of the adequacy and accuracy of all such projections and forecasts so furnished to it and (d) the investor has no claim against The Family Office.

This presentation represents a summary of certain information, the full terms of which are contained in a Private Placement Memorandum that should be reviewed for a more complete understanding of the investments and their risks. In addition, this presentation does not constitute an offer to sell, or a solicitation to buy, any instrument or other financial product, nor does it amount to a commitment by The Family Office to make such an offer at present or an indication of The Family Office’s willingness to make such an offer in the future.

The Family Office is a Category 1 Investment Firm regulated by the Central Bank of Bahrain C.R.No.53871 dated 21/6/2004. Paid Up Capital: US$10,000,000. The Family Office only offers products and services to ‘accredited investors’ as defined by the Central Bank of Bahrain.

 

 

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