Estate planning is “tedious” because not only do you have to figure out the many things that you need to do, you have to go to different providers to get those different parts done, according to Linus Wong, director at Bequest Private Limited, an estate planning company. We spoke to Linus about the one-stop shop concept that his company is championing to help make it less cumbersome for people to get their estate affairs sorted.
Name: Linus Wong
Company: Bequest Private Limited
Estate Planning Specialization: Will writing
Base Country: Singapore
Service Style: Empowering, relationship-oriented
Anything Interesting: Collector of ~40 guitars
Q: Can you tell us more about Bequest?
Wong: Bequest is fundamentally an estate planning firm. But we don’t just provide the main milestone services, such as will writing, estate and business succession planning, we also provide all the bits and pieces in between. These can be the administrative and nitty gritty work that law firms and the financial industry don’t really do but are essential.
For example, after someone passes away, how does the accounting work for the executor (person who administers the estate of the deceased)? How do you account for and keep track of the various decisions that you’ve made with regards to the assets? Do you know how to correspond with all the various institutions, such as writing certain letters to close off bank accounts?
Here’s the problem why estate planning and execution is tedious.
Estate Planning Involves Not Just One Industry
Estate planning and execution involves multiple industries. There are a lot of providers from various sectors providing different solutions.
For instance, banks provide solutions when you are alive, but they don’t provide any services after you pass away. After you pass away, probate law firms only go to court to apply for grant of probate, but they don’t do anything before and after that. And then there’s insurance where it’s somewhere in between. You buy life insurance when you are alive, but the value is mainly realized after you pass away.
(Probate is the legal process where the executor (person appointed in a will) applies for a Grant of Probate (a legal document) to manage and distribute the deceased's estate.)
Because each industry has their own protocols and their own licensing and regulatory framework, it creates boundaries between the industries and no one provider can provide a holistic solution.
This is why estate planning for an individual feels disjointed and incoherent.
Eventually, we hope people can come to us and be educated about what legal instruments are necessary for their particular situation, discuss any financial solutions related to their intentions, etc. Even when circumstances change, such as a change in family relationships or change in personal finance, we would be able to help them solve problems along the way and help them achieve what they want to achieve.
Q: Can you tell me a bit more about your history? What did you do before and how did Bequest come about?
Wong: My academic background is law but I worked as a financial advisor throughout law school and another seven years after graduation. This has contributed to me realizing that there are significant gaps between the advice that I was providing to my clients and the solutions that I was able to construct.
Q: Can you explain the gaps that you saw?
Wong: People have this notion that once they have done their financial planning, everything will just magically be in place, such as money automatically appearing in bank accounts or a person will appear with a cheque and hand it over to the grieving widow at a funeral. But it doesn’t work like that in the real world.
There are a lot of legal, administrative, industry-specific hurdles to get through before the grieving widow can get the money. Through my working experience, I started to understand where the discrepancies are and how incomplete the whole estate planning space is.
Let me give you an example.
Obstacles Faced By People After A Loved One Passed Away
Let’s say I have some assets, such as insurance policies, properties, and shares of a business. One day, I kicked the bucket. The first thing that one needs to realize is that just because my spouse is legally married to me in Singapore doesn’t mean that she has autonomy over my assets.
While it seems like she just needs to find a lawyer to assist her to go to court to get things such as a court order, she still needs to know what to do after getting the court order.
For instance, for the property, is it going to be a title transfer or should she sell the property and distribute the proceeds? What if there are three beneficiaries involved and one of them wants to sell but the other two disagree?
Read more: Property and Inheritance (Singapore)
Business interests can also be very complicated, especially if other key business partners or shareholders are involved. She has to decide with my existing business partners what happens to the business. Are the shares going to my spouse or are my business partners going to buy over her shares? If so, what is the price? Maybe she just wants to own the shares, sit around, and do nothing.
A lot of businesses break down due to the death of a partner, and a lot of conflicts arise between new and existing key shareholders because they don’t agree on how things should be done.
Q: Who is Bequest’s target audience?
Wong: Service providers often choose to serve the ultra high net worth market because it has the highest profit margin and requires the least investment for them. But there is a huge proportion of the population who are also facing estate planning issues at a very different scale and this is the market that we target.
As a one-stop shop, we target the mass affluent market, where a significant percentage of people are generally dual income families who have paper assets and are basically millionaires.
Dual Income Families Are Underserved
This is the fastest growing segment in Singapore and also the most underserved. Their assets are slightly less complex than the ultra-rich, but that does not mean that they are not concerned about wealth distribution and management after their death.
For instance, a family with $500 million in assets versus a family with $5 million in assets. Does the $5 million family care less about estate planning? The $500 million family was also a $5 million family some generations ago.
Everybody wants to build a legacy for their family, so families are looking to grow their assets through estate planning. A majority of people are not only underserved, but they are not even aware that this is something they need to think about.
Q: Do you work with everything related to estate planning?
Wong: Yes. We are an estate planning platform and our partners include a law firm and a financial institution. When a client wants legal advice, we will direct them to our partner law firm, and if they want financial advice, our clients can have access to a licensed financial representative. The financial advisors are trained by us specifically to dispense advice from an estate planning perspective, so we can assure the quality of the services provided.
Since the whole estate planning space is very segmented, we have proceeded to do everything on the platform. Even though we are separate entities, we are all working together.
Q: What are the benefits of a one-stop shop versus going to different firms?
Wong: Cost optimization. Usually, people have to go to different providers and pay different fees, where each provider has their own profit margin to care for. If there are five things and I can do all five and charge the same price as those five providers, my profit margin is probably going to be higher because I have more economies of scale.
Instead of charging a client more, we will charge a lower overall price while still being able to have the margin for our business to run sustainably. In this way, clients pay less overall and get more unified advice while we build long term relationships with these clients.
For example, clients may come to us initially to talk about their wills, but we could proceed to talk about more things, such as their business, property, and mental capacity. Rather than having to talk to many different people, clients only need to talk to one person. They don’t need to spend time explaining their situation to each and every provider all over again. Most people prefer to operate this way.
Q: How much would a will, financial instruments, and legal advice cost on average and how much does Bequest charge?
Wong: The highest component of estate planning is the financial tools. For example, an insurance with a $2 million coverage and lump sum payout would be around $500,000, a complex will costs around $2,000 and a trust is around $6000.
If we were to do all these for the client, we can waive about 50% of legal fees, or even 100%, depending on how we balance the books. We are basically charging significantly less than providers out there.
Q: Are there any trends or interesting things in the estate planning space?
Wong: I am seeing a surge of low-cost, low-expertise wills in the market, such as will templates and DIY kind of wills. It creates a bad impression that these services are disposable, where people can just go for the cheapest one. Why these low-cost solutions thrive is because people are generally afraid of long term commitments.
For instance, people are willing to pay a large amount for a surgery to save their lives, rather than spending the same amount and spread over the years to have a healthier diet. But the good thing is that because the low cost solutions are more of a throwaway, more people are willing to be exposed to the idea of estate planning.
Secondly, big organizations are also providing these low cost options, which help start a lot of conversations that lead to deeper thought processes and eventually lead to larger conversations. Once people see that these low cost disposable options are insufficient, they will seek something deeper.
Q: Are there any memorable cases you have encountered?
Wong: We had a case about a very sick, old lady. She was quite well-off and had a lot of assets in her home country and in Singapore. At that time, her husband, along with some of her other kin, were all up against her and were fighting for her money. At one point, she let go of her estate and gave them what they wanted, but they abandoned her eventually.
We did her will and lasting power of attorney (LPA) when she was on her deathbed. She was mentally sound but by the third time we went to visit her, she passed away. This wasn’t the first (and won’t be the last) case that we encountered but we were really heart broken.
Normally, I'm not a very family person. But this incident made me appreciate my family more. I became warmer and more sensitive. Relationships always break down, and from my understanding, because families didn’t remedy a misunderstanding when it first started, the wounds eventually become infected and irreversible. This job constantly reminds me not to take relationships for granted.
Q: Do you have any secret talents? Anything interesting about you?
Wong: I play a number of instruments and am particularly interested in playing the guitar. I have a room with a collection of about 40 guitars. That’s my secret spot.
Music is a very big part of my life, it symbols my youth and is a form of escape. I had a troubled childhood, often being bullied, but I found solace in music. It helped me find my voice and myself. I think guitar is a good way of expressing certain ideas and emotions to the other party. I even used the guitar to court my wife.
This interview has been edited for length.
FAQs
Is estate planning and estate execution complicated?
Estate planning and execution can be complicated as it involves different industries. Different industries provide different solutions and they each have their own protocols and licensing and regulatory framework, which creates boundaries between the industries. No one provider can provide a holistic solution.
What are the benefits of an estate planning one-stop shop?
Clients can pay less overall and get unified advice compared to having to go to different providers and pay separate fees.
Are high net worth individuals the only people who need estate planning?
No. The mass affluent should also be concerned about wealth distribution and management after their death. The mass affluent are generally dual income families, who have paper assets and are millionaires. While their assets are less complexed, they also face estate planning issues at a different scale.
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