As an expat in Singapore, you may have already made plans for what will happen to your estate after you pass away. But how often do you speak to your parents about their plans and wishes for the future?
The subjects of money, later-life care, and inheritance can be tough to navigate, especially if you live in a different country than your parents. But the benefits of including them in your financial plan can be significant.
Read on to discover why speaking to your parents about their finances and wishes for the future can be so beneficial for expats.
1. An open conversation can be an opportunity to help your parents protect their wealth
If your parents haven’t spoken to a professional about their finances, they may not have extensive knowledge about how to protect their wealth and pass it down to the next generation tax-efficiently. With so many tax rules to consider, particularly if you have family living in different countries, it can be easy to fall foul of the regulations.
As such, it could be helpful to speak to your parents about how you’ve chosen to prepare for the future and protect your assets. This can be a positive way to start a conversation about money if you’re unsure how to broach the subject directly.
2. It’s important to understand your parents’ wishes for the future
One of the great benefits of talking about finances and the future is to help you understand your parents’ wishes. This might include how they plan to pass on their wealth, how you can help them to manage their finances if they’re unable to later in life, or how they’d like to use their wealth during their retirement.
As well as enabling you to help them achieve their goals, this can also help you to prepare for the future. For example, it might be sensible to create a Lasting Power of Attorney (LPA). An LPA means they can nominate a trusted person to look after their financial affairs if they lose the mental capacity to do this for themselves.
For you personally, it can also be helpful to understand your parents’ financial situation and their expectations about their estate plan. When you know more about this, you can prepare your own finances effectively if you’re to receive an inheritance or if their plans could affect your finances in another way.
3. Create a document containing the important information about your finances together
A more practical benefit of speaking to your parents about money is to understand what assets they have and where they are held. Many people never find out how much their parents have in savings, investments, pensions, and property until after they have passed away. At this point, it’s much more difficult to find the answers to important questions.
Having everything written down in a secure file can help to make the process of distributing their assets after death much more straightforward, particularly if you are living in another country from them.
This could take the form of an “in case of emergency” (ICE) document. An ICE document contains details of all the important accounts and contact details that someone might need access to if you fall ill or pass away. Examples include:
- Your savings and investments
- Your pension(s)
- Your will, LPA, birth certificate, property deeds, and other official documents
- Contact details for your solicitor, accountant, financial planner, doctor, and other relevant professionals
- Any online accounts, such as store credit accounts and credit cards
- Any funeral arrangements you have made.
Be careful about including sensitive information in this document such as pins or passwords.
4. A financial planner can help you to put an estate plan together that works for your family
If you’ve benefited from speaking to a financial planner, it could be helpful to introduce your parents to them as well. By having some combined meetings, your planner could help you and your parents to discuss your financial plans in a positive way.
As well as helping you to understand one another’s goals and priorities, your planner could also point out some opportunities you may not have considered.
A further benefit is that, if your planner has worked with both you and your parents, they could help to support you all through key life milestones, such as implementing an LPA or acting as executor of a will.
Get in touch
If you’d like to learn more about how we can support you and your family in managing your wealth for the future, please get in touch.