Wealth Insights - January 2017

Wealth Insights

January 2017

Insurance and Your Family

Major life events bring changes that often call for a review of your financial plan. When your income increases, you're about to borrow for a new home or car, move to a new job, enter a marriage or your family grows, there's more on your mind than your insurance coverage. However, when meaningful change happens, it's a sure sign to look over your insurance strategy and how it fits in your overall financial plan.

It's understandable that when we think of life insurance, we may think about the negatives associated with insurance, such as the loss of a loved one. However, there is a positive side to insurance – you are buying peace of mind and protection for your family and loved ones.

What's behind the life insurance advantage?

What is often overlooked is life insurance's role as a financial planning tool. There are two clear rewards from owning a policy that are valuable at any age.

First, life insurance can create a tax-free benefit for the people you care about most. When paid out a policy's proceeds can pass directly to your beneficiaries, avoiding the time and expense related to probate and estate settlement.

Next, permanent life insurance - whole life or universal life - channels a portion of the premiums paid to accumulating tax-deferred savings, creating an opportunity to build wealth more efficiently than through taxable investments.

Your age, health, tax situation, income needs and risk tolerance are just some of the variables that factor into a life insurance decision. To achieve your goals, your planner may recommend simple term life insurance, or for more flexibility, a permanent policy.


Imagine your spouse having to make mortgage payments, pay living expenses, put your children through school and prepare for retirement when the earnings expected from your career are cut short. Having the right type and amount of insurance will ensure that life continues without major sacrifices and struggle for your family. Our ability to earn an income is clearly valuable to our spouses and family.

Insurance can be thought of as financial protection for dependants. It can replace the income that your family will lose if you were to die unexpectedly, become critically ill or were disabled and unable to continue working. With the right amount of insurance, you're making sure that the money you intend to earn in your working life will be there for your spouse or family to use. Three Reasons to Consider Life Insurance for Kids

Three Reasons to Consider Life Insurance for Kids

Is life insurance for adults only? Not necessarily. Here’s why:

Guaranteed Insurability: By purchasing life insurance for a child now, you guarantee that he or she will always have coverage in the future. Even if the child develops a health problem and becomes uninsurable as an adult, he or she will still be protected.

Lowest Rates: Because premiums increase as a child ages, you'll always pay more for insurance later in life. A life insurance contract purchased now gives children an edge in life, because they'll spend less on insurance when they become adults.

A Smart Gift Idea: Place a term life insurance contract in a safety deposit box and give it to the child when he or she is older. Or, purchase a cash value whole life policy which earns compound interest tax free, and can provide the child with funds for college.

Get the right advice.

Most people's first experience with life insurance is to fill a need for basic protection. But its value seldom stops there. As part of a well-constructed financial plan, life insurance can make a meaningful contribution to helping you achieve your long term goals.

Speaking to your Westminster Savings financial planner is the first step to unlocking the broad benefits of life insurance, and giving you and your loved ones the financial future you want. Call us at 604-517-0100 or send us your question online and we'll respond to you within one business day.


Credential Financial Strategies Inc. is a member company under Credential Financial Inc., offering financial planning, life insurance and investments to members of credit unions and their communities. ®Credential is a registered mark owned by Credential Financial Inc. and is used under licence.