Chilliwack – My mom’s, sister’s, and my life changed forever on May 14, 1975. I can still hear the phone ring in the middle of the night (I was 12 years old). My mom’s frantic voice and tears, “no, no, no” after the nurse told her that her husband and our Dad had passed away from a heart attack. I was still too young to understand what had happened. Years later, I learned my father had no life insurance, will, or joint bank account. My mom bravely faced the next few years, overcoming this financial crisis and dealing with her grief. It took over a year to access Dad’s money in the bank account. I would learn a valuable lesson. With no financial planning, you leave a mess for those left behind. I tell my story and hope it will never happen to your family or loved ones. Sadly, it happens daily as over 57% of Canadians have no life insurance, and 20% are underinsured (often significantly). I have never understood this, as we all face a 100% risk of death, and the majority of people are not financially independent. Interestingly, most wealthy Canadian families have life insurance as they understand it has many benefits to protect their legacy and loved ones. Let me explain eight benefits of life insurance and wealth contracts for you and your loved ones. Beneficiary designation. Payment is made tax-free to the recipient (in most cases), usually within 30 days.
Estate planning. It keeps these assets outside your estate and avoids probate, significant taxes, accounting, and legal fees. Depending on the size of the estate, this can save tens of thousands or hundreds of thousands in taxes and fees. There are no surrender fees or charges when a contract pays out, saving costs for the family.Creditor protection of this asset. The asset is protected from bankruptcy or lawsuit if the money has been in the contract for several years.Insurance contracts have death benefits and deposit guarantees. These features are not available in bank or credit union products.Guaranteed income for life. There are minimal contracts left, so if you want a portion of your wealth to provide lifetime income, I encourage you to act soon.Life insurance is inexpensive when compared to the enormous benefits.Peace of mind. You know your family is protected financially in an untimely death. Bill Westmacott owns Fivefold Financial and is a life insurance broker in BC. .
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