The power of trust: a happy turning point in the challenges of an aging society

        Imagine sitting in a quiet caf é, enjoying the floral aroma of Yejia Xuefei. The sun is shining outside, the breeze is gentle, and before your eyes, your beloved family is chatting and laughing with you. However, you feel a little uneasy in your heart: as your body gradually weakens, how can you ensure that you live with dignity and that your property is properly managed and inherited? In this issue of 'Finance Column', we will explore this life topic together with you.

        Three major challenges for Taiwan's transition into an aging society

                1. The growth of the elderly population and the increasing economic burden

        Taiwan is about to enter the ranks of the "super elderly society" this year. With the rapid increase in the proportion of silver haired population and the gradual decrease in the proportion of labor force, overall productivity may face a decline, and the medical, care, and social services needed by the elderly will inevitably increase the economic burden on society. Many families may face unaffordable caregiving costs, especially in the absence of a sufficient pension system, and long-term care expenditures are undoubtedly a major challenge to social financial pressure.

        2. Increased risk of dementia and disability and crisis of property freezing

        Many elderly people not only require daily care, but also professional medical or mental care. However, due to changes in family structure, many children are unable to take care of their elders full-time, causing heavy economic and psychological pressure on their families. If the caregiver becomes dementia or disabled, and their assets are frozen, it will undoubtedly make matters worse.

        3. Asset inheritance planning and inheritance disputes

        For many elderly people, the issue of inheriting assets is not only about financial considerations, but also involves the harmony of family relationships and the fairness of property inheritance. After all, property distribution can easily lead to disputes and have a profound impact on family relationships. It is worth noting that in addition to different assets (such as real estate, cash, insurance benefits, securities, etc.), different inheritance methods (gifts, sales, trusts, wills, and insurance), and inheritance time points, there are different taxes. The tax sources of children's inheritance also need to be concerned.

        Trust: One of the key solutions for an aging society

        Faced with the above challenges, the trust system is an effective property management tool that can provide feasible solutions in real estate management, equity inheritance, long-term care arrangements, inheritance distribution, and other aspects, helping the elderly enjoy a peaceful life in their later years. The following introduces several important functions of trusts:

        1. Ensure property safety

        By establishing a trust, the parties can designate a trustee (such as Far Eastern International Bank) to manage the property on their behalf and distribute and use it in a predetermined manner. In the future, whether due to health or other reasons, if the trustee is unable to personally manage the property, they can ensure the safety of the property and achieve long-term financial management goals in accordance with the trust terms. In addition, in the face of rapidly changing fraud methods, trusts are also a major solution.

        2. Long term care guarantee

        Trusts can also ensure the medical and living expenses required by elderly people during the care process. As long as the parties establish the trust, they agree in the contract that the funds can be used to pay for long-term care expenses or directly disbursed to nursing institutions, and adjusted according to current needs. This can effectively reduce the financial pressure on families and ensure the quality of life for the elderly. Elderly people in need, 'Elderly Care Trust' is an option worth considering.

        3. Avoid property disputes and inheritance issues

        Trusts can help elders regulate asset distribution in writing during their lifetime, specifying the use and inheritance of assets, and reducing family disharmony caused by inheritance. In addition, if you are worried about passing away earlier than your family, you can use an "insurance trust" to take care of your family, which can avoid paying a large sum of insurance benefits at once, developing the habit of family extravagance, or being coveted by friends and family.

        4. Social Responsibility and Charitable Trusts

        Some elderly people hope to use some of their assets for social welfare or charity after accumulating wealth. If one can make good use of charitable trusts, it can ensure that their estate will continue to be used for charitable purposes after their death, realizing their personal social responsibility and value. Single and childless individuals can also use "testamentary trusts" to achieve the purpose of estate distribution and caring for specific individuals.

        Far Eastern International Bank's professional trust services help you confidently embrace the era of advanced age

        The following case illustrates how trusts can help elderly people achieve financial planning:

        Mr. Li is a 70 year old entrepreneur who has accumulated considerable wealth. As he grew older, he gradually felt unable to handle tedious financial affairs as he used to, and particularly anxious about long-term care and asset allocation issues. At a customer briefing held by a bank, Mr. Li learned about the operation of a trust and decided to establish a trust to address the aforementioned issues. He designated a trustee to manage his property through a trust, and detailed the methods of care and asset distribution in the trust agreement. At the same time, he used equity trusts to plan the inheritance affairs of the family business.

        Establishing a trust has relieved Mr. Li's worries, as he knows that there will be no disputes between family members over property issues in the future, and he can ensure that assets are used according to plan. When he is unable to take care of himself, he has sufficient funds to pay for long-term care expenses. Most importantly, Mr. Li's assets were properly managed during his lifetime, and the family business continued to operate, which made him feel very satisfied.

        Faced with the trend of an aging society, how the financial industry can respond to the increasing demand for elderly property management has become a major issue. Whether it is safeguarding the quality of life of the elderly or ensuring reasonable distribution of property, trusts can be seen as a flexible and effective tool for property management. Far Eastern International Bank has been deeply involved in the trust field for over 30 years, with rich experience and a strong team of experts, able to provide customized trust services for clients. It has won the first place in the B group of Anxin Trust for three consecutive years. Welcome to book a professional consultant at Far Eastern International Bank to prepare for your own and your family's future!

        For a more detailed introduction, insights, and exciting cases of trust functions, welcome to listen to the podcast channels S2-EP1 "When Love Knocks on the Door, Is It Heartbeat or Heartache?" and S3-EP2 "Inheriting Happiness with Trust.

                *Image source: freepik

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