A.T. Financial Newsletter
Give your kids a head start,
with life insurance
What's one of the most valuable gifts you can give your children to help them get off to a good start in life? Believe it or not, the answer may be life insurance.

Purchasing life insurance when your children are young can give them a head start on insurance protection that can last a lifetime. It's also a great way to increase your children's financial options as they grow older. And in most instances, coverage for a young, healthy child is very affordable.

And lest you think that you can rely on the healthcare system or other social safety nets, consider that the same study reported that 8.1 million Canadians (typically adult children) provide 70% to 80% of all home care.

Life insurance for children provides the basis for coverage that can continue when they are adults. Down the road, your children are likely to appreciate your foresight at a time when they may have high expenses and it may be difficult to find money to start life insurance coverage from scratch.

Guaranteed insurability
Arranging coverage early in life can also help avoid problems your children might have obtaining insurance when they're older. Many companies offer options that guarantee the insured's right to purchase additional insurance in the future without having to pass insurability tests. This can be a huge relief for someone who develops a medical condition in adulthood that would otherwise make him or her uninsurable or make insurance extremely costly. Some career or lifestyle choices can also make it difficult to obtain coverage. If your child makes one of those choices, life insurance will already be in place.
Cash value
If you opt for insurance that has a cash value, you're building up a source of funds that your child can use in the future. Your child could use it for education funding or perhaps for the down payment on a home. The policy does not have to be cashed in order to access its value. The cash value can be used as collateral for a loan. It's important to be aware, however, that the value of the policy will be reduced by the amount of any loan outstanding.

If your child doesn't need the cash, the investment portion of the policy continues to grow tax-advantaged for your child's later benefit.

Financial support for your family
In the unlikely event that anything does happen to one of your children, life insurance can prevent you from suffering financial hardship in addition to your emotional loss. You may want to take time off work, beyond your employer's allowed bereavement leave, and the tax-free insurance funds could give you the flexibility to take as much time as you need.

In addition, you might need the money to cover outstanding medical bills if your child was ill for an extended period.

Take action today
There's no better time than now to talk to us about life insurance coverage for your children. We can show you how buying a policy today can provide your children with a brighter tomorrow.
Creating a taxsmart
There may come a time, either approaching or during retirement, when you have a certain amount of savings earmarked for your heirs. Ordinarily, these would pass through your will to your intended beneficiaries. But there may be a better way.

When these funds are fixed-income investments in a non-registered account, interest income is fully taxable each year at your marginal tax rate. With a few simple steps, you can move these funds into a tax-sheltered environment, resulting in a larger inheritance for your loved ones.

How it works
The vehicle is a universal life insurance policy, which includes both an insurance and investment component. You make a series of deposits over time, with part of the deposit covering the insurance premium and the rest invested.

You have a wide choice of investments, including fixed-income and guaranteed choices suitable for the inheritance. No tax is paid on investment income within the policy - that’s the key benefit of this strategy.

The net result
With this strategy, your heirs receive the proceeds of the insurance policy directly, without delays of estate administration. This includes the balance in the tax-exempt investment component as well as the life insurance portion - so if you purchased a $500,000 policy, that's $500,000 for your loved ones. All proceeds are tax-free. Sound like something that might suit your estate planning needs? Then give us a call to talk about this tax-saving inheritance strategy.
For more information,
please contact us at

(647) 833-2782