In an increasingly globalised world, entrepreneurs often find themselves criss-crossing borders in pursuit of new opportunities for themselves or their families. One long-standing client of Julius Baer found himself in exactly this situation in his mid-forties. Discover how his succession plans were supported by the help of Julius Baer in this real-life case study.

Moving to the United Arab Emirates

For this client, the business he had started was well established. He no longer needed to be so closely involved operationally – so he took the opportunity to move to the United Arab Emirates, where he felt his family would have a better standard of living. Relocating always brings a number of considerations, but many people don’t realise that moving jurisdiction can impact succession plans, particularly regarding the transfer of wealth. Regulation related to forced inheritance varies globally. In this case, he required his last will be executed based on his new locale, taking into account inheritance taxation, both of which can have long-term repercussions.

Navigating local laws and customs

After his relocation, the client’s relationship manager asked whether he had considered the impact on his succession plans. “This is where we discovered that there was no succession plan in place,” Anna Ivanova, Head of Wealth Planning Emerging Markets, remarks.

“Our primary objective is to ensure that our clients have their assets distributed according to their wishes. This client had no plan in place because, like so many others, he was young – in his mid-forties – and didn’t perceive a need for one. We understand that this is also a challenging topic for clients. Clients consistently emphasise the importance of wealth planning. However, when asked about their succession plans, many admit they have none. Typically, it takes a significant event to prompt action.”

The best advice any wealth planner can offer is to establish a plan as soon as you acquire any assets – whether it’s a house or potential inheritance – or when you have children. “In this instance,” explains Anna, “the client believed his situation was straightforward and did not require wealth planning. We see this quite often, especially in the Middle East, where the absence of personal taxation means that many individuals do not prioritise wealth planning unless their situation is particularly complex.

“However, his move to the UAE meant that without a plan, his wishes may not be honoured. A solution need not be complex, it could be as simple as a last will and testament recognised in your jurisdiction. But having something in place is essential.”

Anna and her team recommended that the client draft a will and register it with the Abu Dhabi Civil Family Court (ADCFC) to ensure local recognition. She also supported the client in conveying his family’s options when it comes to investment management and financial planning to maintain their lifestyle in his absence.

Creating a personal Emergency Folder

Additionally, they advised the client to create an Emergency Folder. This folder provides the next generation with crucial information, including the location of all important documents, contacts of doctors, lawyers, bankers, and other advisors, a list of assets, participations, positions held, and login details and passwords for devices. Such a folder ensures that successors can easily find all necessary documents and data in an emergency situation, significantly simplifying the process during difficult times.

“This is the core message I wish to convey about succession planning,” Anna concludes. “Wealth planning does not necessarily involve creating a trust or any other complex solution – though, of course, that can sometimes be necessary. Wealth planning is about discussing how a client’s succession wishes can be fulfilled.” Sometimes it can be as simple as executing a legal document, creating an emergency folder with most important documents, contacts and information, and communicating clearly with the next generation.

Small steps to kickstart your succession plans

An emergency folder is a simple, practical way of collating important documents and information in one place. It will prove especially useful should you find yourself unable to make decisions independently. It is not a succession plan, but rather a single entry point for documents and information. However, it may be helpful for stimulating future planning and succession discussions.

To explore our emergency checklist and more case studies of real clients, download our guide here.