An Investment For Peace of Mind: Using Life Insurance

Published in June 2020

Photo by Paige Cody on Unsplash

"Life insurance is missing the immediate gratification gained from buying something new like a shiny car, so people push it off. Instead, they should consider that permanent life insurance and it's conservative investment offer a peace of mind that will protect their family throughout their lifetime and into the next generation. It's a very valuable addition to any asset mix".  

This response came from one of our top clients when asked to share his perspective. 

Many of our clients implement term-insurance in their younger years to gain family protection. Once they reach their mid 40s to early 50s, they often start funding a permanent plan which combines life-long insurance with a stable, slowly growing investment. The conversion of term insurance is the simplest way to make that change, and would be particularly helpful if the insured person has become uninsurable.

​A portfolio of multiple insurance plans can be built, depending upon the growing needs of the family.

It's also worthwhile to note that professional and entrepreneurial investors are often choosing permanent insurance with it's investment piece over the available fixed income options. The return of the insured investment is often better, even after paying for the life insurance coverage, due to the tax exemptions that come with the plan.   

Legato3, our permanent insurance solution, gets formed with a limited number of defined payments shifted into its investment account over a few years. The contract guarantees a certain amount of life insurance coverage that increases slowly over time and remains in force for the entire lifetime of the life(s) insured. Both the policy value and total payout amount steadily increase due to the consistency of the annual yield being deposited back into the account. Like Buffet says, the best way to make money is slowly. 

In addition, the Canadian Income Tax Act (ITA) provides a number of tax benefits for this "insured investment". They are numerous and worthwhile to understand, so let us know if you'd like to determine if and how you could benefit?

Once you review those tax-reduction and tax-elimination opportunities and consider the permanency of the life coverage, you should come to the conclusion that there's an attractive and quite inexpensive solution here, relatively speaking. 

Photo by Yasmin Dangor on Unsplash

Since the global pandemic crisis in this Spring of 2020, people have been choosing to plan their family finances in a new way. 

Would you reconsider your own goals and objectives to include some of these ideas? ​

We invite you to explore!

 Don Anderson
@ Legato
Protect your wealth and your family.

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