Permanent life insurance can be a very effective estate planning & tax saving tool for your family and business. Converting an existing term insurance to permanent is an easy way to get that permanent coverage – and with the tax rules changing Jan 2017, you get a lot more tax-free benefits if you convert this year.
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The new rules governing CPP were introduced in 2012 and they take full effect in 2016. The standard question regarding CPP remains the same – should I take it early or wait? We outline the reasons to take your CPP early or delay your CPP in this article.
2016 is an opportune year to buy life insurance. After this date, certain new policies will not have as much tax-free benefits as they currently do. This means policies approved and issued in 2016 are grandfathered with the higher tax-free benefits, but be aware that most insurance companies need about 3-4 months to get through this underwriting & approval process.
Many would agree that two of the greatest risks to the sustainability of a business are: not having enough money to keep the company going in times of lower income, and losing the ability to make money. Here are some essential tax-savings & risk management strategies to keep your business going during medical emergencies, save you taxes and leave more money in your pocket.
The small business corporate tax rates can be quite a bit lower than an individual’s income tax rates, especially as you take more money out of your company. So you can usually save taxes by using of corporate dollars whenever possible. Here’s one great idea using your corporation to save on taxes – while also reducing the risk of health issues affecting the sustainability of your company.
This financial planning strategy replaces your taxable investments with tax-free insurance benefits to your heirs, by-passing your estate and probate fees and keeps this portion of your legacy gifts private.
Most people would agree that life insurance is an integral part of any comprehensive financial plan. The question is how to decide on the best type for your needs. This document can help you understand the different types of insurance options and how to select the type of plan that best suits your needs for coverage.
Your most valuable asset is your ability to earn income. What are the chances of you being unable to work due to accident or illness? What about the risk of paying higher taxes if you’re relying on withdrawing RRSPs for additional monies required – to pay for extra medical and non-medical expenses? What about if you have to get extra help or your family has to reduce work hours to help you out?
The tax-exempt changes to life insurance become effective Jan 2017. Having the appropriate plans in place can therefore be significantly more beneficial to you if ISSUED in 2016, but be aware that most insurance companies need about 3-4 months to get through this underwriting & approval process.
If your plans involve doing well financially and leaving an inheritance for future generations, look at using life insurance to transfer wealth tax-free. This would seem preferable to leaving a big chunk of your hard earned money for the government. It also protects your money from probate and claims or “challenges” made to your Will.
Get in touch
Magdalena (Medy) Dytuco,
CPA, CGA, CFP
Tel: (604) 368-1735
Medy, also known by her “proper name” Magdalena, is a Certified Financial Planner, Designated Accountant, trained life coach and has over 20 years experience in business and financial analysis. She also coached a leadership course for several years and completed the Coaches Training Institute Co-Active Coaching program. She brings all this together in educating and empowering her clients with creative strategies to help them achieve the life they want at retirement, reach their financial goals with freedom & ease, as well as to keep more of their hard earned money through their lifetime.