Technology's Influence on Global Wealth Building in 2024

Navigating the Complexities of Wealth Creation in a Technologically Advanced Era

The landscape of global wealth building is undergoing a transformation in 2024, influenced significantly by technological advancements. Insights from Al Jazeera and Wealth Management highlight the critical role of technology in shaping economic conditions and wealth management strategies.

Artificial Intelligence (AI) is expected to play a pivotal role in the global economy, with forecasts suggesting a boost in productivity for high-income economies. However, this rapid advancement in AI may also lead to increased inequality, as low-income economies struggle to keep pace. The integration of AI in financial services, particularly in customer service, risk management, and investment decision-making, is expected to redefine the industry.

The rise of distributed ledger technology in wealth management is another key trend. Tokenization of assets using this technology could revolutionize asset management, making transactions more efficient and secure. This innovation presents a significant opportunity for the wealth and fund management industries to evolve rapidly.

In wealth management, firms are increasingly integrating advanced technologies to provide more efficient and personalized services. Strategic use of AI, distributed ledger technology, and other digital innovations are shaping the way wealth is managed and grown.

The global wealth landscape in 2024 is also influenced by broader economic trends. Geopolitical tensions and varying economic conditions across regions contribute to the complexities of wealth building. The divergence in growth prospects between developed and emerging markets highlights the need for a nuanced approach to wealth management and investment.

Tech Transforming Currency Trends: The Digital Shift in 2024

How Technology is Shaping the Future of Currency and Payments in 2024

The year 2024 is set to witness significant advancements in the realm of currency and finance, largely driven by technological innovation. Sources such as TechInformed, BizTech Magazine, and The Financial Brand offer a glimpse into how technology is reshaping currency trends.

Central Bank Digital Currencies (CBDCs) are at the forefront of this transformation. 2024 is expected to see significant development in the implementation of CBDCs as governments globally view digital currencies as opportunities rather than threats. This shift is anticipated to introduce new use cases across retail, wholesale, and cross-border transactions, with a focus on interoperability with other regulated money forms.

Artificial Intelligence (AI) is poised to aid digital transformation in the financial services sector. In 2024, AI is expected to play a crucial role in customer service and risk management for financial institutions. Its capabilities in enhancing customer communication, personalization, and generating actionable data insights are set to redefine customer service in the banking industry.

Digital wallets and digital identities are another key trend, with an expected significant growth rate globally. The integration of digital identities into wallet apps and the adoption of digital identity solutions will transform how we interact with financial services.

Furthermore, advancements in AI will also transform Anti-Money Laundering (AML) tools, making compliance processes faster, cheaper, and more effective. The focus will be on developing AI-powered systems that can keep pace with the rapid changes in payment and regulatory environments.

Effects of the CPFSA changes on Retirement Planning

Focus on clients above or near 55

Dear valued clients and friends

In 2025, the CFP Special Accounts of members aged 55 and above will be closed and all monies there will be transferred to their OA which earns only 2.5%

If you are above Age 55 this year (2024):

And you have done the CPF SA Shielding earlier, no action is needed from you now.

Since you have already fulfilled the Full Retirement Sum, in 2025 all monies in your CPF SA will be transferred to your CPF OA and no money from your CPF SA will be transferred to your CPF RA.

Thereafter, if you decide to enhance your CPF RA up to $426K, you must top-up manually using cash or CPF OA.

If you are Age 54 this year (2024):

In 2025, you will not be able to do CPF Shielding because your CPFSA will be closed and the Full Retirement Sum of $213K will be transferred from your SA and the balance will be transferred to your CPFOA.

You can consider investing your excess fund in your CPFOA or use it to Enhance your CPF RA up to

$426K.

If you are Age 55 this year (before Sep 2024):

You can still proceed with CPF SA Shielding because you still will be able to enjoy the 4.08% in your CPF SA for 2024. In 2025, you can consider the below options on deploying your CPF SA effectively to meet your retirement needs.

Options to use your CPF for retirement after 2025 :

Option 1 :

To leave it in CPF OA to earn 2.5% interest for retirement. 

Clients who choose this option do not like to take risk and would like the principal to be guaranteed with high liquidity. They also like to leave the principal for their spouse or children.

Alternative :

To invest in Insurance Retirement Plan to provide a stream of income for your retirement with guaranteed principal.

Monthly or yearly coupons payout are between 3.2% to 4% (of principal invested) and clients can cash put the guaranteed principal anytime from the policy year the coupons start paying put.

These policies can also be passed on to client's spouse or children when they passed on.

Option 2 :

Top-up CPF to get the Enhanced Retirement Sum. 

Clients who take this option do not mind that the value of top-up will be zero when they pass on and nothing will be left behind for their spouse or children.

They also do not mind that the Top-up amount is illiquid.

Interest earned in CPF Life will go into the CPG Life pool. 

After you pass away, your beneficiaries will receive your CPF LIFE premium balance, which is the total initial CPF LIFE premium that you have paid minus the total payouts you have received.

Alternative :

They can invest the $213K in our Dividend Portfolio or Phillip Next Gen Tech Portfolio (PNGT) for potentially higher dividends payouts or yearly profit withdrawals.

The Dividend Portfolio aim to provide about 6% to 7% per annum of dividends to our clients.

Phillip Next Gen Tech Portfolio aims to make about 6% to 9% of profit for withdrawal depending on yearly market conditions.

Principals are not guaranteed due to market fluctuations but are not likely to become zero. 

Investors can also WILL these portfolios to their spouse or children after they pass on.

Please feel free to contact me if you have any questions or would like a discussion about how to optimize your CPF balances to meet your specific goals.

Best Regards,

Jason Tan | Mobile : 96369839| Private Portfolio Manager

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