A.T. Financial Newsletter
ESTATE PLANNING
Win-win-win with this
charitable giving strategy
Canadians are among the most generous people in the world. According to Statistics Canada, we gave some $8.5 billion to charities in 2011, and fully 23% of us claimed a charitable tax deduction that year, with a median donation of $260.1

Given our collective philanthropic spirit, it's not surprising that many of us also hope to make charitable giving part of our estate plan, to share our good fortune and to stand as a legacy after we're gone. Enter the Charitable Remainder Trust (CRT). This is a truly flexible, powerful tool that can deliver generous tax benefits today, provide a life-long income for you and your surviving spouse (or other loved one), and still leave a very generous legacy to your alma mater or favourite charity at death.

How it works
Briefly, a CRT is a trust into which you would usually place an income-producing asset. There is tremendous latitude with respect to the assets that can be used to fund a CRT. They include life insurance, annuities, cash, securities, and even real estate. You then name your school or other registered charity as the trust's irrevocable beneficiary.

You retain control of the asset for as long as you live, which means that you make the decisions about it and you receive all of the income it produces for as long as you live. At death (or after the deaths of you and your spouse or other designate), the asset
and all of its residual value are transferred to your chosen
charity.

From a tax perspective, you are considered to have donated the asset at the time the trust is established. You will receive a tax credit that year based on the fair-market value of the asset.

Why it's so valuable
One of the key benefits of a CRT is that you retain control of its assets. In the case of a family cottage, for example, you might not get an income stream from the donation. But you would enjoy a lifetime's access to property and a sizeable tax credit for donating it. The CRT could also be a way to avoid the prickly subject of who might otherwise inherit the asset and pay the tax bill on its deemed disposition.

Another benefit is that assets assigned to a CRT do not have to pass through probate and so will not leave your estate with any probate or administration fees.

As you would expect, careful planning when establishing the trust will help secure the most benefit now and for your beneficiary down the road.

These types of gifts are much sought after by charities and many organizations have full-time staff to answer your questions and administer your gift. It may even be possible to establish an endowment fund or program that will carry your name forever. We can help you get started.
1 Statistics Canada, The Daily,
February 13, 2013.
INCOME PLANNING
Could you outlive
your income?
We don't hesitate to insure our most important assets - our lives, our homes, our ability to earn a living. But what have you done to protect your retirement lifestyle from the possibility that you will run out of money before you run out of living?

Consider the statistics: If you're a 60-year-old woman, you can expect to live to almost 90. If you're a man that same age, you should plan on celebrating your 87th birthday.1

Safeguard your income
A longer life means more years in retirement. If you are expecting to fund those years with payments from a pension plan, your Registered Retirement Savings Plan (RRSP), and other investments, you can take steps now to safeguard that income. One option to consider is an annuity.

An annuity can help protect the lifestyle you envision: It guarantees you will not outlive your income.

Flexible options
You can set up an annuity to guarantee your income for as long as you (or you and your spouse) are living. You can purchase it with either registered or non-registered money. And, for even more peace of mind, your payments can be set to increase each year, to counter the effects of inflation.

As you're contemplating the best way to safeguard your retirement lifestyle, know this: We can't help you live long, but we can definitely help you prosper.
1 Canadian Institute of Actuaries, Canadian Pensioners Mortality, July 2013.
For more information,
please contact us at

(647) 833-2782