Leonardo Alves
CEO
Plan Wealth Management
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View from the Top

Mexicans Need to Start Saving Now

Tue, 09/04/2018 - 12:39

Q: How has the public’s perception of the insurance market evolved in Mexico?

A: Thirty years ago, Mexicans did not think much about insurance. At that time, families owned large tracts of land and had many children who would look after their parents in their old age. The situation has changed enormously as child rearing is much more expensive, especially in large cities. For that reason, families need to look for alternatives like insurance. Not many companies were willing to provide insurance in Mexico because Mexicans were reluctant to accept it. However, this is changing and now there is a massive need for insurance products. Furthermore, a growing number of people can now afford these products.

Q: What is Plan Wealth MGMT’s value proposition for the Mexican market?

A: We provide clients a tailor-made plan to meet their needs. An adviser analyzes the client’s circumstances and filters the market to identify the products that best suit those circumstances. Clients do not need to change their lifestyle to adapt to a product because the product adapts to them. We are international financial advisers and we work with many banks outside Mexico, which gives our high- profile clients access to the global markets for healthcare and biotechnology. We provide access to a wide variety of funds, such as UBS (Lux) Equity Biotech that is valued at over US$1.1 billion and incorporates 46 different companies in the biotechnology sector. Many insurance and financial firms are coming to Mexico but the current offering is not enough to satisfy demand.

Q: Why did Plan Wealth MGMT choose Latin America and what specific benefits do you see in Mexico?

A: While other companies prefer Russia, China or the Middle East, we prioritized Latin America because the region did not have a culture of investment, which is now becoming a booming market. Many more companies will eventually enter the region but we have been in Latin America for 10 years and now we are experts here. For instance, to begin investing in UBS (Lux) Equity Biotech it is necessary to begin with US$5 million. Through our financial instruments clients can invest just a fraction of that number. Mexico represents one of the greatest opportunities globally as the country is one of the leaders for opportunity investments in the healthcare sector. Mexico’s economy is doing well as its middle class is growing and its population is becoming increasingly aware of the importance of insuring themselves.

Q: What are your expectations for the growth of the Mexican investment market?

A: Mexico has everything it needs to continue growing, including natural resources, a stronger middle class, competitive labor and an ideal location close to the US. The peso is weaker against the dollar, which is a significant financial opportunity for foreign players. There is no doubt that during the next 30 years Mexico will become one of the leading economies in the world.

We expect to grow significantly in the country, in part due to Mexico’s aging population. Thirty years from now, Mexico will have a much older population and the government will be unable to afford to look after everyone. For that reason, many incentives have emerged, including tax deduction plans.

Q: What are the main reasons for investing in healthcare?

A: People are living longer and the last years of a person’s life usually carry the largest costs in medical terms, which make the healthcare industry one of the best sectors in which to invest, especially in the middle to long term. Many are expecting to die at the age of 77 but an increasing number of people are living more than 80 years thanks to medical advances. We can provide people with a way to access money for the rest of their lives and even to bequeath it to their kids. By creating awareness now of the need to save, we are preventing poverty in the future.