• Address: 60 Paya Lebar Rd #04-41 Paya Lebar Sqaure Singapore 409051
  • 10:00 am - 6:00 pm
+65 8588 6921

Blog Details

You may have heard before how the rich set up a family trust to distribute their estate to their family, which may last for a few generations, you may wonder if family trust is catered only for the rich?

There is a lot of talk about the estate of Late Macau casino mogul Stanley Ho, about his plan to distribute his US$2.5 billion worth of estate his 4 wives and 17 children.

According to the report1, Stanley Ho’s kids will receive each at least SGD 18,000 per month from his family trust. He is believed to transfer most of his estate to the family trust, and then distribute the profit of family businesses to his family member. His family member does not inherit the share, only the benefits, this strategy preserve and protect his family business from any dispute2,3,4, as long as his family business continue to be managed well by his successor, his family member will continue to receive monthly allowance from generation to generation.  

The benefits of having a Trust including

  1. Protect assets and vulnerable beneficiaries from undue influence and predatory persons
  2. Maintain privacy of family wealth
  3. Reduce conflicts between beneficiaries
  4. Use as a family reserve
  5. Creditor protection
  6. Prevent squandering of wealth
  7. Preserve hard-earned monies within the family
  8. Achieve family goals and promote family values
  9. Plan for business succession or exit arrangement

In this article, I will show you how we can make use of family trust to preserve our wealth for our next generation! With proper plan, our wealth that we accumulate can last from generation to generation! And good news is, you don’t need to be ultra rich to own a family trust.

When was your last time to review your financial portfolio, to calculate your total net worth? We may not have million dollars of liquid assets now, eg cash, private property, investment, especially for young family, that is why most of the young family think estate planning is not their priority now, as they don’t have much to plan for it, and too early to plan for it!

However, if anything happens to us, our assets, either liquid (Cash, investment and etc) or non-liquid (HDB, Private Property, CPF, SRS), as well as the benefits of life insurance, will form our estate, and then distribute according to our Will, if no Will, then will be following Intestate Succession Act (Chapter 146)6.

Is it too early to plan for young family? Let us do a simple calculation on how much an average family (husband and wife) have, and they don’t realise about it!  






It is compulsory to buy mortgage insurance/Home Protection Scheme if CPF-OA is being used for mortgage payment, if one of the owners passes away, the remaining loan amount will be covered.



Assume that CPF-OA is fully utilised for mortgage payment, only left Special Account and Medisave Account

Life Insurance


Life insurance can be affordable if term life is being utilised, only cost about 30-50/month (To age 65, premium depend on age)



Dependant Protection Scheme, the only life insurance that you can use your CPF-OA to pay



Cash and others





2.6 million is not a small amount of money, if anything happens to parent, lump sum of the estate will be inherited by children. Parents have done their part to leave enough money for children for their future living, however, for minor, they can’t access to estate until they reach at least 18 years old. 

When they inherit when they reach 18 years old, it will be a lump sum of money and they may not have the knowledge and experience to handle it. End of the day, your good intention may not turn up to what you want to see.

For example, Mr. and Mrs Chia passed away accidentally, left behind 2.6 millions of estate, including cash, CPF, HDB, life insurance and etc. They have one daughter and one son, 3 and 5 years old respectively.

There are 3 ways the estate of 2.6 million can be handled.


Equal share for children


This method is the most common planning/no planning for young family, equal share for children, fair enough?

However, minor below Age 18 cannot access to estate. When they access the inheritance when they reach 18, they may be too young, lack of experience and knowledge to handle a big sum of money. End of the day, good intention from parent may not turn up to what they want to see.

Ask yourself a question, what would you deal with 1.3 million when you are 18? When you know you will have 1.3 million when you are 18, are you still motivated to study hard to get into university?

Under ISA rule, parents of Mr. and Mrs. Chia will get nothing under this arrangement, are they relying on Mr. Mrs Chia for living? Is it really what Mr. and Mrs Chia real intention to leave nothing to their parent?


Simple Planning, with Testamentary Trust/Standby Trust


Extra steps can be done via Testamentary Trust/Standby Trust, to delay payment to beneficiary.

Conditions can be set in order to release money from estate, for example

A)     Pay 1,000 per month for guardian as allowance, thanks guardian for taking care of their son and daughter, until they reach age 21

B)     Guardian can claim up to 1,000 per month for son and daughter for the living cost.

C)     Son and daughter may receive 2,000 per month during their study in local University (maximum 4 years for degree, maximum 8 years for Medicine degree)

D)     Tuition fee can be claimed from estate

E)     To graduate from local university, 20,000 will be given as a gift

F)      To get married for first time, 50,000 will be given as a gift

G)     To buy first property, 200,000 will be given as a support

H)     The remaining part of the estate will be distributed equally when son reach 42 years old and daughter reach 40 years old

Testamentary trust/standby trust can protect minor from different angles. When minor reach 18, most of the time, they don’t need so much money if they are still studying, if condition can be set, such as monthly allowance will be given if study in local University, they will be motivated to get a good result, and get into local university.

With degree holder, and when they reach certain age, they may have better skills and knowledge to handle a lump sum of money.

Depend on the background of the family, different family may have different setting for the estate to be paid out.




Advanced Planning with Standby Trust

Option 3 is very popular among ultra-rich family, late Macau casino mogul Stanley Ho, Genting Highland’s founder Lim Goh Tong, and etc, set up family trust to benefit their children and grandchildren, and the family trust can last for few generations if they have proper business succession planning.

Nowadays, you don’t need to be ultra-rich to own a family trust. As mentioned earlier, our estate including life insurance as well, and it is not difficult to buy million-dollar policy with affordable premium.

For Mr. and Mrs. Chia, they leave in total 2.6 million estate. We assume that their children continue to stay in their HDB (while most of the cases, minor stay with their guardian, either rent out the HDB and collect rental, then minor inherit the HDB when they turn age 21, or sell the HDB away).

In Option 2, Mr. and Mrs. Chia choose to distribute their assets over the years, after paying guardian fee, tuition fee, and etc, just soon or later, 2.6 million will be fully utilized.

In Option 3, with additional planning, set aside 200,000 as reserve fund for crisis, then invest the other 2 million. Mr. and Mrs. Chia may give instruction to Trustee for investment strategy, eg 100% in Bond, 30% Bond and 70% Equity, or 70% and 30% Equity, and then Trustee will find investment company to do the investment for Family Trust to generate return.

Before their son and daughter reach age 21, guardian fee and living cost are coming from the dividend of the investment, and after age 21, son and daughter will receive the perpetual dividend, without touching the capital of 2 million!

In this scenario, we are using conservative return of 3%, after deducting Trustee’s admin fee and management fee of investment company. The common return of long-term bond is about 3-5%, and equity’s dividend is about 3-6%. Furthermore, we do not factor in the capital appreciation of the fund, if the fund being managed properly, it is not difficult to grow capital at 4-8% p.a.

Since capital is not being touched, with capital growth, the family trust is expected to benefit for few generations.






Option 3 has demonstrated how an average income family can own a family trust, and clearly show that family trust is not only for ultra-rich only, in fact most of us can own a family trust, the question is how good you are in planning!

If you wish to know more about how you can setup a family trust base on what you have, please feel free to contact us to have a complimentary meeting with our Estate Planner!



  1. https://www.8days.sg/sceneandheard/entertainment/stanley-ho-s-kids-will-each-receive-at-least-s-18k-a-month-from-12915800
  2. https://www.scmp.com/news/hong-kong/law-and-crime/article/3087789/stanley-ho-daughter-takes-legal-action-hong-kong-high
  3. https://www.scmp.com/news/hong-kong/law-and-crime/article/3088888/stanley-ho-nephew-becomes-second-relative-register
  4. https://calvinayre.com/2020/08/10/casino/pansy-ho-fights-for-control-over-stanley-hos-estate/
  5. https://www.lexology.com/library/detail.aspx?g=41812726-1c7a-4eba-9db5-a03cac3a0afb
  6. https://sso.agc.gov.sg/Act/ISA1967



Leave a Reply

Your email address will not be published.

You may use these <abbr title="HyperText Markup Language">HTML</abbr> tags and attributes: <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <s> <strike> <strong>