Alberta Life, Disability, and Health Insurance Since 1983

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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 Motkosk At the Helm of Vistaplan Financial Group

David is a well-respected insurance advisor with over 30 years of experience helping healthcare professionals, business owners, and their families secure their financial futures. He takes the time to make certain his clients understand the life, disability, and health insurance products they are purchasing, so they can make the right choices for their budgets, plans, and futures. CONNECT WITH ME ON LINKEDIN

Life & Disability Insurance for Alberta Health Care Professionals, Business Owners, and Their Families Since 1983