Holistic wealth management can unlock wealth transfer benefits

Although it’s vital to keep business, family and personal accounts separate from one another, considering each within a holistic context can help you create a stronger, more equitable wealth transfer plan.

Wealth transfer planning is a crucial part of wealth management. If done effectively, it can secure a comfortable future for your family across several generations.

However, as your wealth grows, your financial services needs become more complicated.

One of the challenges New Zealand business owners face when drawing up wealth transfer plans is that their wealth may be spread across multiple different accounts, assets and investments. Each of these may be managed with the assistance of different professionals from a range of institutions.

This can make it easy to overlook some of the strategies available to you, and ultimately risk you and your family settling for ‘good’ rather than ‘ideal’.

In New Zealand, those born before 1966 currently hold about 60% of New Zealand’s total individual net wealth, which is estimated at $2.29 trillion. Over the next 20 years, approximately $1.11 trillion is expected to be transferred by those aged over 55¹.

While the exact figures for anticipated generational shifts in responsibility within family offices aren't readily available in New Zealand, the significant wealth transfer indicates a substantial shift in financial responsibility and asset management in the near future.

This means billions of dollars are already flowing to the next generation in a trend that’s expected to gather pace for several years.

Worryingly, a widely cited study out of the US found that as much as 70% of wealth transfer plans fail, with reasons for these disappointing results ranging from familial infighting to poor planning².

This highlights the importance of taking a holistic view of your wealth when planning a transfer. By looking at all your assets – including your business – as well as your investments, your home, and any other personal wealth you’ve accrued, you may find you have more options to manage the division and distribution of your wealth.

For example, you might be able to access better financing arrangements by including your business as an asset when refinancing. Or by looking at your business alongside your investment portfolio, you may find a more equitable way to divide your wealth among your children – reducing the risk of your estate plan being challenged in court.

To offset these challenges, ANZ Private’s suite of specialist teams can work closely alongside one another and other professionals within their extensive networks. This provides each team with greater oversight of a client’s full financial position that can enable them to construct more appropriate solutions.

In addition to providing business, personal and investment banking services, ANZ Private boasts a strong relationship with ANZ Investments. ANZ Investments’ in-house investment management team is one of the largest and most experienced investment team in New Zealand, managing over $30 billion in assets for our clients. The team are experts in investment strategy, manager and investment selection, portfolio implementation and risk management; conducting global and New Zealand-specific research and constructing carefully considered portfolios for clients.

Both teams work collaboratively to help clients find the best possible outcomes. This can even be done through a single point of contact, your dedicated, local Private Banker.