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Posted: 11 Sep '11

Life Insurance and Estate Planning

Life Insurance and Estate Planning

As Fall comes we will start to meet with our accountants to make final plans for this tax year.  I would suggest that if  you’re 50 or older you should start looking at the projected tax liability you’re leaving your family.

Let me give you an example of what that tax liability might look like.

Let’s make some assumptions about what your assets might be worth today.  Since I work with a lot of professional corporations on a daily basis let me use a PC as one of the assets. Fatherandson

For this example let’s assume you’re age is 55 and the current value of your PC is 500,000 dollars and your RRSP’s are also at 500,000 dollars.  Assuming the growth rate is 5% into the future.  You continue to make RRSP deposits for 10 more years and you save $20,000 per year in your PC.

You retire at age 65 and start drawing down your savings.

Your projected tax liability at age 80 will be $704,443 dollars.  How does that make you feel, today you are working harder than ever to accumulate a net worth only to give the taxman over 700 thousand dollars when you and your wife pass on.  It hardly seems fair.

There are solutions and there are actions you can take today to reduce that cost substantially.  But if you don’t know there’s a tax liability problem coming you might not plan and without planning there is no way to save. 

Watch this blog next week for the 4 funding alternatives that are used to pay the tax and what each will cost you today.  


About the Author - David Motkoski

David Motkoski—At the Helm of Vistaplan Financial Group

The team at Vistaplan is led by David Motkoski, a well-respected insurance adviser to hundreds of business and individual clients. David has 30+ years of experience in this industry helping clients understand their life and disability insurance, office overhead, critical illness, long term care, and accident insurance. David’s focus has been medical doctors, dentists and business owners who are concerned with having the right coverage to provide for their family or business and protecting their income

David is an independent broker offering policies with Manulife, ivari and RBC to name a few. Vistaplan Financial Group has clients dating back to 1983 and they stay loyal with David because of the strong relationships he builds.