A popular misconception about life insurance planning, is that it’s something to do with ensuring others (your policy beneficiaries) enjoy the fruits of your insurance once you’ve passed. While that is just one aspect of planning for the inevitable, if executed properly, life insurance planning can offer multiple benefits – even as you live to enjoy them!
WHY LIFE INSURANCE PLANNING IS IMPORTANT FOR INDIVIDUALS & FAMILIES
Death benefits pay-out for survivors is only one aspect of life insurance. If the policy holder passes, the cash value of the policy can help young families meet their financial needs, or can even help pay off a mortgage. However, there are other facets of life insurance that are equally important.
Most life insurance products allow policy holders to tap into funds as the value of their policy grows over time. In case you are looking for tax-deferred gains, a life insurance policy offers that too, because you are only taxed once you withdraw the money from your policy. With the right life insurance planning strategy in place, your policy can act as a great source of tax-free wealth transfer to your beneficiaries.
In retirement, a well-planned life insurance strategy can serve to generate additional retirement income, or it might even provide additional living health care benefits in your old-age.
WHAT WE CAN DO FOR YOU
Not every life insurance policy provides you all of these benefits. Our experienced Life Insurance Planning specialists will discuss your needs in detail, and then customize a life insurance plan that meets those specific goals.
Some of the life insurance planning tools and products available to our advisors include:
- Term Life Insurance: If you have a specific time-horizon over which you need protection, then Term Life Insurance policies are definitely worth considering. These policies are designed to provide short to intermediate term coverage at an affordable cost. For instance, if you have young children whom you wish to provide for until they are older – say 15 to 20 years – or if you have an unpaid mortgage that you want your family to pay off in the event of your untimely passing, then a Term Life policy is worth considering
- Permanent Life Insurance: Permanent life policies not only provide insurance protection for life, but are also a great way to grow the value of your policy. The enhanced cash value might then be tapped subsequently, to meet future needs, such as funding college/university education of a child, or creating an additional retirement income stream
- Participating (or Whole) Life Insurance: Depending on what your investment goals are, our insurance advisory team might recommend a Participating Life Insurance product for you. With these products, the cash value and death benefit payout of your policy can experience tax-advantaged growth within the policy. You might also be eligible to borrow tax-free funds (for any purpose you might deem fit) against the cash value of your policy
- Universal Life Insurance: If you are in search of higher savings and earnings potential from your life insurance policy, then a Universal Life Insurance might be what our advisers recommend. These policies also offer great flexibility, as the amount insured can be changed, and premiums can be adjusted (increased, deferred, decreased), while enabling policy-holders to also withdraw part of the cash value
- Variable Life Insurance: If you are someone looking to leverage stock market performance through your insurance policy, then a Variable Life Insurance product might be what you need. They provide policy-holders the option to invest their cash value in a host of insurer-recommended stocks, bonds, money-market funds and other investment products. Our insurance specialists will make you aware of the all the risks and opportunities associated with a variable insurance product
Not everyone of us is equally prepared for retirement. While some of us are fortunate to have built a nest egg that will last us through our Golden Years, others will depend on government programs for retirement income. Regardless of which side of this divide you are on, Annuities can be a powerful vehicle to help you fund your retirement dreams.
Whether it is to deliver guaranteed income to you and your loved ones in retirement, to protect your principle while also providing income, or to provide death benefits to your beneficiaries upon your passing, there are annuity products to meet every conceivable need.
WHY ANNUITIES ARE IMPORTANT
The short answer: Diversification. Peace of Mind. Flexibility!
Many retirees and soon-to-be retirees are concerned over the safety of their investments in mutual funds, ETFs and stocks. The gyration in the stock market is often hard to stomach for seniors entering their Golden Years. With the help of a well-chosen Annuity, one can add a layer of diversification to your retirement portfolio.
Then, there’s peace of mind. Annuities are structured as investment vehicles that are insulated from the fate of stock market behaviour. The nature of Annuities means you’ll never need to worry about when/how long you’ll need to wait before you recoup losses from the next stock market crash! Your Annuity investments are sheltered from such risks.
And of course, for the soon-to-be retiree who is concerned that he/she has missed the proverbial retirement savings boat, Annuities offer good news! Because there’s no limit to how much you can contribute in Annuities, on an after-tax basis, you’ll have flexibility in how much you save, and will never have to worry whether it’s too late to play the “catch up” game.
WHAT WE CAN DO FOR YOU
If used strategically, Annuities can be an extremely powerful retirement income planning vehicle. Here are some of the ways that our Annuity experts can help you:
- Use annuities as a retirement planning option: Our team of specialists will work with you to review your entire existing portfolio to determine whether Annuities are right for you. In some cases, an overexposure to other fixed-income products, like Bonds and Dividend-paying stocks, could still leave your retirement income exposed. We’ll help you decide if Annuities are the right retirement planning option for you
- Make cost-effective Annuity choices: Not all Annuities are created alike. While they may generally be a great choice for generating fixed-income in retirement, the cost associated with producing such income could sometimes be high. Our Annuity specialists are familiar with the entire Annuity landscape, and can help identify the most cost-advantaged Annuity investments for you
- Receive tax-advantaged income: We help clients manage their tax liability through prudent product selection. Some annuities, like tax-deferred variable products, enable investors to receive tax-deferred income now – by not including such income to determine your current tax liability. Subsequently in retirement, when you might be in a lower tax bracket, your annuity-dependent income will not be a source of significant taxes
- Build flexibility into your retirement planning objectives: We do this by choosing annuity products that can easily be switched between investment portfolios without the risk of triggering associated taxes. So, if your investment objectives change during the investment horizon, you can effortlessly switch to a different annuity to support your new objectives, without fear of being saddled with a huge tax liability