Everyone's life is in contact with wealth, from creating wealth, accumulating wealth to inheriting wealth, wealth management is a lifelong compulsory course for everyone. But when it comes to wealth management, many people's first reaction may still be "What products should I invest in?" Which product makes the most money? When is the best time to invest?" And so on, these ideas actually ignore the essential function of wealth management to some extent. Wealth management is to provide essential financial support for the realization of life goals. The ultimate goal is not to achieve temporary income, but to meet the financial needs of individuals and families. In order to truly manage your wealth, you first need a comprehensive wealth plan.
Wealth planning is a process of integrating wealth resources and achieving financial goals
The essence of wealth planning is the shift in thinking about family wealth management, from "I want to earn a 10% return on investment every year" to "I want to maintain a comfortable standard of living after retirement," "I want my children to go to Ivy League universities," "I want my family business to be sustainable." At the same time, their children can pursue their dreams without worry."
Generating returns through investment is certainly part of wealth management, but it is not all; More importantly, it is a means, not an end. Wealth planning, on the other hand, is a completely goal-oriented process, based on the assessment of the family's current financial situation to design a plan, and ultimately to ensure financial support for the realization of real life goals such as starting a family, establishing a career, educating children, providing for old age, and having a family to pass on.
Wealth planning is the key to living a good life
The real meaning of wealth management is not to make the account balance more than a few zeros, but to achieve a young and carefree, a family and a career, a home, medical care for the sick, elderly care, family inheritance, to meet the financial needs of individuals and families, and wealth can also be inherited and distributed according to their own wishes. To achieve these goals, comprehensive wealth planning must be done as early as possible, otherwise even billions of dollars of wealth may be lost unknowingly.
At this point, NBA star Allen Iverson may be able to give us an "answer" like his nickname. Iverson earned more than $200 million in his career, but his lack of planning and profligacy nearly bankrupted him shortly after retirement. But the reason why Iverson is not really bankrupt is precisely because his agent set aside a portion of his endorsement fees to set up a trust fund that allows him to receive $1 million a year to live on, but he is not entitled to use the principal until the age of 55, which is to achieve a certain degree of wealth planning.
Everyone needs a wealth planning plan that works for them
Whether it is a new employee who just stepped out of school, an ordinary middle class family supporting the elderly and young, or an ultra-high net worth person who has achieved financial freedom, they all need a set of wealth planning suitable for their own, but the focus of wealth planning will be different for different types of families.
For young single people, the most important plan may be to accumulate wealth for their marriage, house and car and other big expenses;
For middle-class families who have already achieved a small career and have some savings, in the face of a family structure with an elderly family and a small family, more attention should be paid to ensuring and improving the future living standards of family members. For example, if you plan to have a second child, you need to change a big house, the education fund reserve for your child to study abroad in the future, the annual spending plan for traveling at home and abroad with a family, and the purchase of appropriate insurance products for yourself and your family in case of emergencies, etc.;
For ultra-high net worth families at the top of the wealth pyramid, problems that money can solve are no longer a problem, and the focus of wealth planning is more on the inheritance and use of wealth. For example, the wealth distribution of multiple children, the succession of family businesses, the dilution of family wealth brought about by children's marriage, the tax risks that may be brought about by CRS, FACTA and other laws, and the tax risks that may be brought about by the introduction of domestic real estate tax/inheritance tax, and the related planning of investing family wealth in public welfare and charity to return to society.
Wealth planning needs to be tailored
Wealth planning is a process of integrating wealth resources and achieving financial goals, and each family's wealth resources and financial goals are not the same, so wealth planning should naturally be tailored to thousands of people.
Wealth planning starts with thinking through some basic questions, such as: How much money do we have? How much money will you make each year in the future? How much will it cost each year in the future? What are the big spending demands? How much risk are we willing to take to achieve these goals? Let's wait.
