Case StudiesFunding & Debts CancellationWillFebruary 12, 2024by Finex & CoEstate Planning for Different Stages in Life – Stage 2: The Sandwich Generation

Peter (45 years old):

“My monthly income is between RM10-15k. The assets I currently own are bank accounts, 2 houses, cars, investments and EPF. I have liabilities of around RM1 mil (mortgages & car loans).”

For individuals with financial commitments and dependents, prioritizing comprehensive protection is essential. In addition to addressing basic life insurance coverage such as death, disability and critical illnesses, it is advisable to enhance medical coverage as well. The focus should be on amplifying the ‘total sum assured’ to create a robust financial safety net.

Once these are covered, Peter can consider bequeathing financial assets to his dependents: parents, spouse and children. If Peter wishes to retain assets: real estate and cash for certain period of time before they can be distributed to the beneficiaries, ie. until the youngest child turns 25, he would need to include a testamentary trust in his Will.


Financial Protection Measures
  • Medical & Life Insurance Coverage: A prudent starting point is to secure a life coverage of minimum RM1.5mil, ensuring there is sufficient capital to navigate life’s uncertainties and fulfill financial obligations. The amount of coverage required may vary based on individual’s debts and lifestyle expenses, in this case, RM1 mil debts and the remaining can be used to support Peter’s family maintenance expenses.
  • EPF (Employees Provident Fund): Nominate spouse as beneficiaries for the EPF account, and add an extra substitute beneficiary, ie. children, for EPF account in the Will.
  • Will + Testamentary Trust: Draft a Will to bequeath assets to dependents, including parents, spouse and children and create a testamentary trust to hold the assets for the beneficiaries in accordance with the terms of the trust. Foe example, “I direct my Trustee, Amy, to hold my house, X, on trust for my son Alex until he reaches the age of 25.”
Estimated Costs
  • Medical & Life Insurance Coverage: Estimated to be around RM1k per month.
  • Will & Testamentary Trust: Estimated to be less than RM2,000, one-time cost.
  • Will Custody: Estimated to be less than RM1,500 for a lifetime.


Additional Considerations
  • Subject to estate administration process: A testamentary trust will only be constituted after the probate has been obtained and the debts of the estate fully settled. As the assets intended for the testamentary trust are always subject to the claims of the deceased testator’s creditors, there would only be a testamentary trust if the assets are not used to pay creditors and outstanding taxes owing to the relevant authorities.
  • Ensuring sufficient funding coverage: Periodically review and reassess your financial goals, lifestyle changes, and overall financial health. Establish and maintain an emergency fund to cover unexpected expenses such as medical emergencies, adequate coverage can protect you and your dependents from financial setbacks.



In conclusion, securing financial stability and protection is a crucial aspect of responsible financial planning, especially for individuals like Peter, who have diverse assets, liabilities and dependents. By addressing key elements such as comprehensive life and medical insurance coverage, thoughtful estate planning through a Will and testamentary trust, and nominating beneficiaries for accounts like EPF, one can build a robust financial safety net.

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