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Changes to the Taxation of Estates

Estate, trust and tax planners have long favoured testamentary trusts as vehicles to pass along assets to beneficiaries or heirs.   A testamentary trust is generally a trust or estate that is created the day a person dies.  Commonly, these trusts are established in a testator’s will.

A significant benefit to testamentary trusts had been that income earned and retained in the trust received the same graduated rate of income tax as an individual tax payer.  Unfortunately, under the terms of Bill C-43, after January 1, 2016, all income retained in the trust will now be taxed at the highest rate of tax applicable in the province in which the trust is resident.

There will be two exceptions to this new rule – The Graduated Rate Estate (GRE) and a Qualified Disability Trust (QDT). Read more


A Lifetime Gift for Your Grandchildren

The Cascading Life Insurance Strategy

If you are a grandparent wishing to provide an asset for your grandchildren without compromising your own financial security you may want to consider an estate planning application known as cascading life insurance.

How does the Cascading Life Insurance Strategy work?

  • The grandparent would purchase an insurance policy on his or her grandchild and funds the policy to create significant cash value;
  • The grandparent would own the policy and name their adult child as contingent owner and primary beneficiary;

Read more


The Best Way to Insure Your Mortgage

If you have a mortgage it makes good sense to insure it.  Owning a debt free home is an objective of any sound financial plan.  In addition, making sure your mortgage is paid off in the event of your death will benefit your family greatly.

The question is should you purchase this coverage through your lending institution or from a life insurance company?  A good rule of thumb to follow when searching for advice?  Ask an expert! Read more


The Estate Bond

Growing your estate without undue market risk and taxes

Often we see older investors shift gears near retirement and beyond.  Many become risk adverse and move their assets into fixed income type investments.  Unfortunately this often results in the assets being exposed to higher rates of income tax and lower rates of return – never a good combination.

Or maybe the older investor cannot fully enjoy their retirement years for fear of spending their children’s inheritance.

The Estate Bond financial planning strategy presents a solution to both of these problems. Read more

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The Corporate Extraction Strategy

Transferring a Life Insurance Policy to a Corporation

The Corporate Extraction Strategy involves transferring a personally owned life insurance policy to a corporation for its fair market value (FMV).  When handled properly, it will result in withdrawing capital from the corporation tax free!

The preferred candidates for this strategy:

  • Own a life insurance policy that they wish to maintain;
  • Own all the shares in a corporation;
  • Are usually older and/or would be rated or declined for life insurance due to health concerns. Read more



Fall into Autumn Savings

By Carla Hindman, Director of Financial Education, Visa Canada

Fall is officially here. With the new season comes new reasons to spend money, including increased utility bills, winter wardrobes and upcoming holiday purchases. Here are some tips to help you fall into savings this season.

Winter proof your home: A little TLC during the fall season can go a long way towards saving on winter utility bills. Improve your home’s insulation factor by caulking or using weather-stripping on windows and doors, and consider cleaning out your gutters to help with drainage. Cleaning or changing your furnace filter and checking into any needed roof repairs are two frugal, essential habits to help prepare for the winter months. Looking for other cost-effective alternatives? Switch to energy efficient lightbulbs. They may cost more initially, but they’ll save you money in the long run. Read more »


Millennials & Money: Talking about Financial Literacy

By Carla Hindman, Director of Financial Education, Visa Canada

Millennials, also known as Generation Y, refers to people born between the years of 1980 and the early 2000s. Known as the “me, me, me” generation, millennials are the first group to grow up in the current digital era with instant access to money management tools at their fingertips. So why do they have a reputation for being financially illiterate? And what’s the best way to reach them? Does it have to be done in 140 characters or less? The answer is: #Yes. Read more »