Estate Planning

“Pamanang hindi pabigat”

Richest Man In PH
What is an
Estate?
Insurance is
not part of
an estate.
In the Philippines…

 According to WHO the average life span of Filipinos is 72 years old.

 Maximum estate tax is 6% with a maximum allowable deduction of PS

5,000,000 (Standard Deduction) and a family home maximum of PS
10,000,000.00.

 Real Estate Property appreciation rate is 4.2% per year (Source: BSP)

 Many heirs got into conflict due to improper estate planning

 So, In planning one’s estate, we need to consider 2 things:
1. Estate Tax
2. Fair Distribution
Key Information Needed for a Sound Estate
Plan

• How much is the client’s total asset? (Savings, Investments, Properties, Business)
• How many are the legitimate heirs?
• How old is the client?
• How much is the client’s current insurance coverage?

C-overage, A-sset, H-eirs, A-ge

*Assets like cars depreciates on an average of 15% a year.

**An Estate Plan can be unique depending on the assumptions and preferrences of the estate planner and the client.
Preparing An Estate Plan

SAMPLE:

A 50 year-old client is asking you to prepare an estate plan. He has a

house and lot worth 7.5M pesos, a mutual fund of about 2M pesos
and savings worth, 3M pesos. No insurance. The client has 2 heirs
and he wants to divide his estate to his heirs equally.

How will you resolve this and What product/s can you suggest?
Exercise

A 45 years old business owner wants you to prepare an estate plan.

He has 3 businesses with a net worth of 2M, 3M and 2.5M
respectively all growing at 10% per annum. He has a family home
worth 5M pesos, a savings worth 3M pesos, a car with a book value
of 2.3M pesos, and an investment to bond securities worth 2M pesos
earning 5% per annum. The client has 3 heirs.

What estate plan are you going to propose and what product are you
going to offer?