SECURE WEALTH BUILDING
Savings and Emergency Fund
Use Your Savings Without Using Up Your Savings
Gone are the days when you could park your money in a savings account and expect it to grow. In this low-interest rate environment, you receive a negligible amount on your savings while the value of money continues to decrease. This makes it hard to save for emergencies or for your next car.
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Think about what you can buy with one hundred dollars today and compare it to what you could buy with one hundred dollars ten years ago. According to inflationcalculator.ca, a basket of goods that cost $100 in 2010 costs $115 today.
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This means that the $100 you put in your savings account ten years ago is only worth $85 today. You could actually be losing money in a savings account. If you end up spending some of it (because life happens) you would want to put it back so that you have money available for the next emergency. But if you've just spent the $100 you deposited into that account in 2010, you would have to deposit $115 in that account today for it to hold the same value. Not only has the growth of your savings, which is already slow, been interrupted, but now you need to deposit more than you did ten years ago to replace the money you spent.
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Instead, why not put your money in a savings vehicle that grows continuously, that you can borrow against without interrupting the growth, and that you can repay at your own pace? You can use your savings without using up your savings. Later, you can pass those savings on to the next generation so they never have to start from scratch.
Cash Flow and Investment Capital
Is your cash tied up in inaccessible accounts, waiting for you to retire before you can access it? If your net worth is high and your cash flow low, you could be compromising both your lifestyle and your ability to grow wealth. Why not create an account that will provide cash flow and investment capital and that will also be available to you at retirement? A specially designed wealth-accumulation whole life policy can accomplish all of this. You will be able to access your cash for investments and lifestyle expenses while your wealth continues to grow, uninterrupted in your life insurance policy. At retirement, you can use your policy as collateral for a bank loan that you can use to enhance your lifestyle. You will be able to rest easy without worrying about the loan repayment. Any outstanding loans will be paid with your death benefit and the rest of the death benefit will go to your beneficiaries. Save your money without compromising cash flow.
Tax Reduction
"You must pay taxes. But there's no law that says you gotta leave a tip."
Morgan Stanley
Think about how often your income dollars are taxed. As an employee, when you get your paycheque, the government takes out income tax before you even see the money you've worked so hard for. Then, when you purchase something with those after-tax dollars, you're going to pay sales tax. If you put your money in an RRSP to save on taxes now, you will still have to pay the taxes later on those same after-tax dollars. In a non-registered account, as the value of your investment increases, so do your taxes. And when you leave that money to your kids, they will have to pay capital gains tax. Getting taxed once again on the same dollar is like giving the government a tip!
Adding participating whole life insurance to your financial plan could change all that. You could increase your wealth by recapturing some of the money you are currently paying in taxes. Once you put your after-tax dollars into a dividend-paying whole life insurance policy with the companies we work with, the government may never see that money again. You can access the equity in your policy tax-free. When you die, your kids get the money tax-free. Contact us today to find out more.
Legacy and Legal Wills
Protect Your Family's Inheritance
When your loved ones are mourning their loss and preparing for your final resting place, the last thing you want is for them to also be worrying about how they will pay the capital gains tax on their inheritance. It might break their hearts to have to sell the family cottage or childhood home that holds so many special memories. That is why many high net worth individuals own whole life insurance.
We can help you set up a dividend-paying whole life insurance policy that will cover the capital gains tax and leave your loved ones with a bonus. Better yet, you can reap the benefits from your policy while you are alive. You can access funds from the policy to renovate the family cottage or increase the value of your legacy in other ways.
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Estate Planning and Legal Wills
Estate planning is an important part of any financial plan. After all of the sound financial decisions you will have made throughout your life, you, not the courts, should have the final say on who receives your assets. This is why you need a legal will.
Your will can be as simple or extensive as you choose. Whether you want to simply leave instructions about your possessions or leave detailed directions for your health care in your later years, care for minors or even your pets, a legal will is the best way to do it. It will greatly reduce the possibility of family conflict after you are gone.
You can complete the process completely online with our partners at Canadian Legal Wills. If you prefer to sit down with an estate lawyer, contact us. Our legal team is ready and willing to work with you until you are completely satisfied with your will.
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Charitable Giving
A Unique Approach to Charitable Contributions
Do you ever feel guilty when someone approaches you for a charitable donation and you are not prepared to give? Does your favourite charity need funds for a big project? A participating whole life policy can boost your tax-deductible charitable contributions.
You have two options when using life insurance for charitable giving:
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1. You own the policy
You pay the premiums and name your chosen charity as the beneficiary. Since you own the policy, you can change the beneficiary if you decide to support a different charity. Although you do not receive an immediate income tax deduction, your estate receives a tax receipt when the death benefit is paid. This can help offset your final income taxes so your beneficiaries receive more of your estate.
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2. The charity owns the policy
You pay the premiums and name your chosen charity as the owner. The charity has access to the cash value in the policy to use when the need arises, as well as the promise of a large future donation when the death benefit is paid. Since the charity owns the policy, you receive an annual tax receipt for the premiums paid.
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