Should you rely on group insurance alone?

How individual insurance can complement your group insurance

Your employer may offer group insurance coverage – for example, life insurance, critical illness insurance or disability insurance as part of a benefits plan.

It’s a basic way to help protect you and your loved ones.

But what if you could do more than just cover the basics? Your lifestyle is important to you and your family, so what if you could complement your group benefits coverage with individual insurance and help keep the lifestyle you’d want for your family, if you died or became too sick or injured to work?

Knowing the details of your group insurance plan is crucial. You want to make sure you have the right type of insurance, and the right amount of coverage, to cover all your bases when dealing with the unexpected.

Individual insurance, such as life, critical illness and disability insurance is coverage you can get outside of work. They typically offer more control and choice based on the needs of you and your family. And it’s all about you: you own it and you choose the products and options you want that are customized for your needs.

Together with your group insurance, they can help protect you, your family and your lifestyle from unexpected events that could jeopardize your financial goals and keep you from meeting your obligations.

Uncover your needs to find out if your group insurance is enough

Does group insurance cover your needs? Consider the following questions:

1. If something were to happen to you or a loved one would you be able to:

2. Does group insurance coverage include the types of insurance you and your family need?

  • Will your insurance protection last a lifetime?
  • Does your partner have group insurance coverage through their work?
  • If you’re too sick to work, would your coverage give you a lump-sum payment to help with recovery?
  • Can you increase your coverage if your needs change?

Better together: Group and individual insurance

For some people, group insurance is enough, but an individual insurance plan can complement your group insurance benefits. I can help sort out the details and fill in any existing gaps.

Helpful tips for first-time life insurance buyers

Buying life insurance doesn’t have to be difficult

Buying life insurance for the first time can seem daunting. It’s a big decision, there are many options to consider and it can be stressful to think about what might happen if you’re no longer there to support your loved ones.

Getting insurance coverage that’s right for you is one of the most important ways you can financially protect those you care for from the unexpected. Buying life insurance is essential at any age and there are key advantages to starting early.

Here are some helpful tips to make the whole process easier for you.

Remember why you need insurance

Insurance can help financially protect those you care about when you’re no longer there to support them. It means there could be money available when it’s needed the most, so your loved ones can spend more time helping each other through a difficult time, and less time focused on how to pay the bills.

Life insurance can help:

  • Cover everyday living expenses
  • Settle debts
  • Keep the family home
  • Continue plans you’ve made for your loved ones, like an education fund

Once you know what type of life insurance you want, you’ll then want to determine how much your family will need to continue their lifestyle after you’re gone.

Life insurance that’s right for your needs and budget

There are two kinds of life insurance:

Term life insurance – temporary, lower-cost insurance coverage (at least initially) which you buy for a set period of Life Insurancetime. When that time’s up, your coverage can be renewed or you can convert to permanent, lifelong, coverage without having to answer further health questions.

Permanent life insurance – typically costs more, but lasts a lifetime and includes features that can grow money inside your policy over time (called cash value). You can access this money while you’re still alive or leave a larger legacy for those you care about.

Once you know what type of life insurance you want, you’ll then want to determine how much your family will need to continue their lifestyle after you’re gone.

To start, calculate:

  • Monthly household expenses – groceries, bills, mortgage, loan payments, etc
  • Planned expenses – RRSP or contributions to your children’s education, for example
  • Expected one-time costs – for instance, funeral expenses

You should figure out how much these expenses will cost for a full year, then how many years your loved ones would need to rely on this income. It’s a good starting point, so you have an idea of your insurance needs, which you can finalize with the help from me.

Don’t forget to insure your health

Did you know you’re much more likely to experience a serious illness or injury before you retire than you are to die? Ask yourself: if you were too sick or injured and couldn’t work for a month, six months or even a year, would you need an income source (that’s not your own) to support yourself and your family? If your answer is yes, critical illness and disability insurance may be valuable additions to your financial security plan that can protect what you’ve planned for and help ensure your loved ones are taken care of.

Consult a financial professional

I can help you create a plan – including life, critical illness and disability insurance – to help protect yourself and your family from any financial or non-financial issues that might come up.

A stronger, better you: Why it’s important to look after your financial health

We all know how important it is to take care of our physical health – it keeps us strong and helps ensure we’ll be around for years to come. But what about looking after our financial health? It’s just as important but often doesn’t receive the attention it deserves.

Even if it seems like you don’t have enough money to invest or buy insurance, it doesn’t take much. If you cut down on extra lattes or meals out, you could set yourself up with a plan for a successful financial future.

Build your personal road map

When it comes to financial security planning, it pays to start small. If you change your spending habits, even just a little bit, the long-term results could be big.

For example, let’s say you made your morning coffee at home instead of picking it up on the way to work. It may not seem like much but the amount you save could be enough for a $500,000 life insurance policy.1

If you cut down on your dining-out expenses by even $20 a week and invested that money, it could grow to almost $37,000 over a 20-year period.2

No matter what you’re saving for, you’re on the road to achieve your future goals.

Other savings ideas:

  • Leave the car at home, carpool, use public transit or ride your bike
  • Shop around for better auto and home insurance rates
  • Install LED light bulbs to reduce energy costs
  • Go to the movies on “cheap Tuesdays”
  • Clip coupons for groceries or buy in bulk
  • Cook at home instead of dining out

With those savings each month, you could:

Invest and watch it grow

A small but regular contribution into something like a tax-free savings account (TFSA) or registered retirement savings plan (RRSP) could grow substantially, if it’s invested wisely and given enough time to grow. Use this money to help fund your retirement or perhaps go on the dream vacation you’ve always wanted.

Protect your family

What would your family do if something happened to you? Insurance is a flexible and cost-effective way to protect yourself and your loved ones financially. It can help pay down your mortgage, cover outstanding debt or fund education or retirement plans.

How we can help

Spending money feels good, but knowing you’re not only protecting yourself and loved ones – but unlocking future potential – feels even better.

I can help you build a customized financial security plan to help you achieve your goals.

1Cost of coffee based on $1.70 per cup. Assumes 30 cups a month. This comparison is based on London Life term 10 life insurance, male and female, up to age 45, non-smokers, standard risk, monthly premium payments. Monthly premium depends on your age, amount of coverage and general health information. Life insurance coverage amounts represent the policy’s death benefit. Rates as of December 2015. Term 10 life insurance premiums increase on renewal after 10 years. The example provided is not complete without the London Life illustration, including the cover page, reduced example and product features pages all having the same date. Read each page carefully as they contain important information about the policy.

2Assumes $80 is invested in a balanced mutual fund portfolio on a monthly basis with a six per cent annual rate of return. Rates of return are hypothetical and provided for illustrative purposes only. Mutual funds are not guaranteed; their values change frequently and past performance may not be repeated. Unit values and investment returns will fluctuate.

Protect Your Business from the Loss of a Key Person

Like many smart business owners you’ve insured your assets from theft or damage.

What would happen if you or one of your key people died prematurely or suffered a life-threatening illness?

Every Company has Key PeopleKey Person Insurance

You probably don’t have to look far to identify people essential to your company’s success.

These are people with:

  • Proven ability to grow sales
  • Highly specialized technical skills
  • Personal relationships with valued customers
  • Responsibility for major projects

Whether it’s a valued employee, a business partner or yourself, each key person brings energy and expertise that can be difficult and costly to replace.

How would losing a key person impact your business financially?

Consider the effects of a key person’s critical illness or premature death.

  • Could it affect your short-term or long-term profits?
  • How much will it cost to replace the key person?
    • Recruiting $     ?
    • Training    $     ?
    • Relocation $     ?
  • Will creditors shorten payment terms or call in loans?

Insurance on you and your key people can help prevent an unexpected loss from financially harming – even destroying – the business you’ve worked so hard to build.

Key Person Protection – It’s Simply Good Business

Two proven building blocks for key person protection are life insurance and critical insurance.

Your business can use the insurance funds to:

  • Pay debts and expenses to help keep operations running
  • Find and train a suitable replacement
  • Increase cash flow to compensate for lost revenue
  • Assure creditors and suppliers that funds are available to meet commitments
  • Show customers that the business has the means to continue

Determine the value of your key people

Ask me how you can implement key person protection as part of your business plan. 519-860-4223

What’s the Best Life Insurance for You?

To build the right financial plan for you, it’s important to know:

What are your life insurance options?

When it comes to life insurance, you have two choices: term life insurance and permanent life insurance. Both are great choices that protect you and your family, but each has different features. Deciding what’s Life Insurance for Familyright for you depends on what you need.

Term life insurance is temporary, lower-cost insurance coverage initially, where your payments stay the same for a set period of time. When that time’s up you can renew your coverage or convert it to permanent life insurance without having to answer further health questions.

Permanent life insurance also helps protect those you care about and provides you with more security because it lasts a lifetime.1 Initially, it costs more than term life insurance but includes features that can grow money inside your policy over time (called cash value). You can access this money while you’re still alive to help you achieve what you’ve always wanted – more retirement income or perhaps to start your own business – or leave a larger legacy for those you care about.

Deciding which option is right for you can be difficult. Here’s some information to help you make a decision.

So which option do you feel best suits your needs: term insurance, permanent insurance or a combination of both?

No one knows your situation better than you do. However, I’m here to help you. I can review your needs, help you choose the right insurance option and work with you to build a financial security plan to protect what matters most.

Five Financial Steps for New Parents

While personal finances may not be on your mind (likely getting enough sleep is), here are five important steps for new parents to consider when bringing your bundle of joy home for the first time.

1. A social insurance number (SIN)

To claim children as dependants or set up savings accounts in their name, they must have a social insurance number. Most provinces offer a Newborn Registration Service that allows you to apply for a SIN. In British Columbia and Ontario, you can apply for their birth certificate at the same time.

New Parents Financial Planning

2. Baby comes first – but don’t forget about your other financial goals

Children can be costly: food, childcare and education costs are just some of the expenses you will need to add to your budget. New parents often prioritize those costs over their own financial goals, such as saving for a home, vehicle or vacation. Remember to pay yourself first and benefit from the power of compounding interest (making interest on your already-earned interest) to increase your savings.

  • Congratulations! Becoming a parent is filled with new joys, new challenges, and yes, new financial goals.

3. Start saving for post-secondary education

With the average full-time Canadian undergraduate student paying annual tuition fees of nearly $6,000+, post-secondary education can be an overwhelming expense. A registered education savings plan (RESP) can help get you closer to that goal. Not only does the money grow tax-free within the plan, but the government chips in with substantial grants.

4. Plan to protect your family’s financial security if the unexpected happens

It’s not easy to think about. But you need to help ensure your family will be taken care of financially if you or your partner died unexpectedly. Once you’ve calculated how much you’ll need to pay off your mortgage, help put your child through post-secondary school, and replace your lost income, you can approximate how much life insurance you may need.

Also, consider these basic estate planning steps for new parents:

  • Create an inventory of assets and debts and store it in a safe place that only a trusted person can access.
  • Review your insurance policies and update beneficiaries if any changes are needed.
  • Prepare a will and identify the person you would request to be the child’s guardian.

5. Budgeting for baby

When infants first come home, the financial resources you require to take care of their needs may be basic. But as they grow, previously unconsidered expenses – such as increased health insurance premiums – can surprise parents. That’s why it’s important to start your budget now. Setting up a category just for your child and logging all childcare expenses under it makes it easy to see how much you’re spending.

Getting your finances in order is a great way to manage the challenges of being a new parent. And hey, as they grow up, your child may even pick up a few tips!

Help Insure Your Child Get’s Off to a Head Start

Tuition costs have nearly tripled over the past quarter-century ­– good enough reason to start planning for your child’s university or college education.

With the average cost of a post-secondary education in 2010-2011 at $58,000 – and climbing – and with the maximum contribution to registered education savings plans (RESPs) set at $50,000, you may be looking for other ways to fund your child’s education. Life insurance can help your children fund their post-secondary education if you or your partner die unexpectedly.

Child Life Insurance

Insure Your Child

How does it work? Most permanent life insurance products offer a guaranteed cash value accumulation component that allows the cash value to grow tax-free (within limits).

When it’s time to withdraw funds for your child’s education, you can either withdraw the accumulated cash value or take out a loan against the policy’s accumulation. If you take out a loan, your cash value can continue to grow, provided you repay the loan. Alternatively, you can surrender your insurance policy if coverage is no longer required and apply this money to your child’s education needs (tax may apply).

Purchasing participating life insurance for your child or grandchild is a gift that keeps on giving. A participating life insurance policy has cash value that can grow over time and can be accessed to pay for things like tuition, a new car, or a down payment on a house. With their insurance needs taken care of for life, they can focus on other key priorities.

I can help you make sense of using permanent life insurance to pay for tuition.

Protect Your Family’s or Business Well-Being

Life is full of risks, and most we simply have to accept. But some we can do something about. Life insurance is an essential tool in protecting a family’s economic well-being if a partner or parent dies.

Life insurance is designed to pay loved ones a tax-free lump sum death benefit if you die. The benefit should be large enough to allow them to have the lifestyle and choices that your financial security plan set out to achieve.

  • Personal insurance policies represent an important part of prudent financial security planning.

The money from the death benefit can be used as needed. Some examples may be to help pay off debts, help ensure loved ones can afford to remain in the family home or pay for the children’s education. The benefit can also be used to help ensure the well-being of a sibling with special needs, or aging parents who lack adequate retirement savings.

Protect Your Family

Good business

Life insurance could also play an indispensable role in protecting a business. If you and a business partner start a company, you should each have a life insurance policy. The reasons make pure business sense.

The death of one business partner may have a significant impact on the company’s operations and life insurance can help the surviving partner manage through the resulting challenges. Life insurance can provide funds to allow the surviving partner to buy out the deceased partner’s share in the company without having to sell assets. Moreover, the deceased partner’s family receives the full amount they deserve from selling their share of the company.

Research tools

There are many online resources and calculators to help you learn about the different life insurance options and coverage needs. The large variety of options allows you to customize a policy to fit your needs, and that may include the flexibility to increase coverage as needed.

Professional counsel

Once you have done some primary research, you can consult me. Life insurance may play a starring role in your financial security planning.

Mortgage Insurance vs Personal Life Insurance

You’re finalizing your mortgage – a huge commitment that comes with a great deal of responsibility. It’s natural to be concerned that your family might lose their home if the income earner was no longer around to make the payments.

You have a couple of options, both involving affordable monthly payments. Lending institutions offer you mortgage insurance – also called creditor insurance – at the time you sign the mortgage. The other route is personal life insurance that you can buy through me.

  • It’s important to research the differences between mortgage insurance and personal life insurance.

Mortgage insurance is convenient. You can apply for insurance coverage at the same time you’re getting your mortgage. This insurance is used to cover the outstanding mortgage balance if you die. You can also include your spouse in the coverage.

Mortgage Life Insurance

However, it’s important to research the differences between mortgage insurance and personal life insurance to help ensure you’re giving yourself and your family the type of insurance protection that meets your needs.

You do have to qualify for personal life insurance, a process that may include verification that you and your spouse are in good health. Once you start paying the premiums, you’re covered for the term of the policy, with automatic renewals. And as long as premiums are paid as required, only you can cancel the policy.

The benefit payout

With mortgage insurance, your creditor is the named beneficiary and the proceeds are paid to the creditor, not your family. If you or your spouse dies, the outstanding amount is paid off. As the mortgage is paid down the benefit coverage decreases.

Personal life insurance allows you to choose your beneficiaries. And the lump-sum benefit payment is paid tax free on the death of the life insured even if the mortgage is paid off. This type of coverage provides added financial security beyond just the mortgage.

Monthly premiums

With mortgage insurance, the coverage decreases each month until the entire principal is paid off and the premiums stay the same. With personal life insurance, your coverage doesn’t decrease as the mortgage is paid down and you can choose a plan that will keep the premium you pay level for 10, 20 years or for your lifetime.

Flexibility

Generally, most lending institutions offer non-convertible term life insurance where the lending institution owns the mortgage insurance policy. If you switch mortgage lenders, your policy is void. Given that you’ll be older than when you originally signed your mortgage or your health may have changed, the premiums with a new lender could be higher or you may not qualify for new coverage.

If you already have a personal life insurance policy in place and you buy a bigger home, you may want to consider increasing the coverage. One option may be to leave the existing policy in place and take out a second one to increase overall coverage for your family.

Take time to compare and carefully weigh both options. I can provide expert guidance.

Financial Planning Process

FINANCIAL PLANNING PROCESS

  1. Introduction
  • Who I am
  • What I do
  1. Understand Situation
  2. Determine Goals & Objectives
  3. Review Investment and Risk Management
  4. Present Financial Security Plan
  5. Present Analysis and Go-Forward Strategy
  6. Implement Plan
  7. Annual Review and Monitoring

Financial Planning Overview

I work with my clients to create a financial security plan that addresses their concerns in four key areas: financial security at death, living benefits, liquidity and retirement. Their financial security plan will be tailored to their needs, risk tolerance and the goals they want to achieve.

Cash Flow and Debt Management

My financial planning process will involve an analysis of your current cash flow and debt levels through a comprehensive budget review.  I will make recommendations on how you can make the most effective and efficient use of your cash, expenses and what you can do to best structure your debt and most effectively pay it down.

Investment Services

I pride my practice on my commitment to a proven process. Before ever making any investment, I first work with clients to develop a complete understanding of their financial position, concerns, tax position, goals & objectives and estate planning. I then work with my clients to help them determine their financial goals and objectives in short, medium and long term. I create a financial forecaster assessment that quantifies my clients ability to meet their goals and objectives given their current financial realities with varying growth assumptions. I believe this is an important tool in determining how much risk NOT to take and establishes baseline investment parameters. I believe this holistic approach allows me to make unique and tailored investment recommendations.

Risk Management

In most cases, the ability of my clients to achieve their intended financial objectives relies on their ability to earn an income. I work with my clients to help ensure the sustainability of income in the event of a disability or critical illness. Using an innovative array of products designed for families, business owners and professionals. I can help mitigate the financial impact in the event of an unexpected medical event.

Estate Planning

I work with families, business owners and professionals to build an estate plan to help ensure their financial matters are distributed the way they would like them to be after their death. It can also help reduce taxes, so more of the estate is left for heirs.

Insurance Solutions

Unexpected events can leave your family without the cash flow needed for day-to-day expenses. I offer a range of products that can provide temporary or permanent coverage to replace your income, fund expenditures that arise due to a death (ie. taxes or final expenses). I can help determine your needs and decide which insurance product solution is best for you.

However, there are other features of life insurance that benefit families, business owners and professionals depending upon their current and long term financial positions. I provide three basic insurance solutions to my clients.

  • Insurance needs over time
  • Alternative investment vehicle for fixed income
  • A strategy for corporate asset efficiency
  1. Temporary and permanent needs over time

Life insurance meets different needs at different stages of your life. You should update your coverage to reflect important events in your life.

  1. Insurance as an alternative investment asset class for taxable fixed income

The major advantage of using life insurance (permanent participating) as an alternative asset class is:

  • Tax advantage on growth
  • Low fees
  • Asset protection
  • Estate tax reduction
  • Stable yields

Tax advantage life insurance products are structured such that a certain amount of life insurance is purchased to ensure that the policy will qualify under the MTAR rules and therefore remain an exempt policy, while at the same time providing the maximum amount of tax advantage income accumulation.

Depending upon client circumstances, funds can either be used to provide an income stream during their lifetime (living benefits) or enhance the value of their estate upon their death.

  1. A strategy for corporate asset efficiency

Save it – Redirect your company’s excess cash from taxable investments to tax advantaged permanent insurance. Growth inside the policy is not eroded by income tax, within prescribed limits. Save on taxes to keep more money working for you.

Spend it – Access the policy’s accumulated cash value by using the policy as collateral for a line of credit. Use loan advances to provide your business or yourself with a stream of income.

Leave it – At death, the policy’s death benefit pays off the loan. The full death benefit payable to your company (less adjusted cost basis, if any) is eligible for distribution to shareholders – including your successors or heirs – as tax-free dividends.

 

The Team Behind Your Financial Security Plan

My support team consists of specialists in:

–       Retirement and investment –       Living benefits
–       Life insurance –       Employee benefits
–       Banking and mortgages –       Tax and estate planning