Graham, like millions of other Canadians, has and uses credit cards. He often carries a balance from month to month and is concerned about making the monthly payments if he becomes disabled or gets seriously ill. Graham doesn't want to stick his family with the balance if he dies before paying it off.
The credit card company offered him Credit Balance Insurance (CBI) that would take care of these concerns. After looking over the offer, he wondered if it was such a good deal.
Making the right choices for protecting you and your loved ones in the case of a premature death comes down to understanding some basic principles and rules of thumb. The first is that the name is all wrong; life insurance does not help you, it helps to protect the standard of living and lifestyle of those you leave behind. So more accurately it should be called something like: loved one's lifestyle assurance plan?.
Ray had thought of his life insurance purely as a protection plan. The anti-avoidance rules and general restriction of tax benefits applicable to most shelters prompted him to take a new look at his life insurance for tax deferral as well.
Don, 65, and Marie, 63, are about to retire. They have accumulated about $500,000 in their RRSPs and own their home, free and clear. They want to leave as much as possible to their two children. Don and Marie realize that the value of their home should pass tax-free to their children and know their RSPs will be fully taxable at that time.
Many believe that if they need long term care, either in their home or in a facility, that the cost will be covered by provincial health care or other government agencies. While there are certain programs available, a significant portion of these costs are the responsibility of the patient.
Glenn had thought of his life insurance purely as a protection plan. The anti-avoidance rules, risks and general restriction of tax benefits applicable to most shelters prompted him to take a new look at his life insurance for tax deferral as well.
You may not be ready for this. Despite all you may have heard, term life insurance is not better than permanent life insurance! And whats even more confusing, permanent life insurance is not better than term life insurance!
Mathematically speaking, they're equivalent.Term insurance is cheap initially, but its premiums usually increase at regular intervals, generally every ten or twenty years. It's like renting your accommodation. Most term insurance policies only provide coverage to a certain age.
