Estate planning is something not a lot of us like to think about, especially when times are tough, as they have been in Alberta for the past few years. It can be difficult to think about saving for the future when even day-to-day expenses can be hard to stay ahead of. But as a low-cost, high-return investment in you and your loved ones’ future, the professional insurance brokers at Lane’s Insurance will always stress the importance of carrying life insurance in Calgary. Life insurance can double as a tax-shielded investment while providing your family with an added layer of financial security. If you’ve neglected to add it to your portfolio, don’t worry. It’s never too late to purchase life insurance, even if you have a preexisting health condition, and providers offer a wide range of coverage options to people from all walks of life.
Life insurance is extremely flexible, with numerous options that are designed to fit specific needs. When choosing your plan it is highly beneficial to sit down with an expert like those of us at Lane’s to thoroughly discuss your options. The type of policy you choose will directly affect the amount of your payments. Here are some of the most common types available:
- Term life insurance is affordable and easy to understand. It provides coverage for a specified length of time (usually 10 or 20 years), and costs are guaranteed for the “term.” Term life insurance can be converted to permanent life insurance at any time. It is a good choice for those who want additional protection while they are at higher risk of insolvency, such as though with large, high-interest loans, a small business owner, a new mortgage holder or those paying for kids in school.
- Permanent life insurance policies are purchased for an indefinite period of time and come with a cash value, providing your beneficiaries with a tax-free payment when you pass away. Permanent life insurance payments generally do not increase over the length of the policy as well. This is a very good option to ensure that your loved ones receive some benefit from your dedication to your policy and to them. Permanent life insurance usually includes a funeral cost payment as well, although experts do caution that it is wise to save additional money for these sorts of arrangements. Different kinds of permanent life insurance include whole, universal and variable policies.
- Simplified Issue life insurance does not require a medical test, but the insured will need to answer health- and lifestyle-related questions. Coverage amounts are usually limited.
- Guaranteed Issue life insurance is issued immediately with no medical questions or underwriting, and is guaranteed even if you have been declined for life insurance in the past two years. The trade-offs for this simplicity are higher premiums and far lower coverage.
It is highly advisable to purchase a life insurance policy when you are young and healthy, even if it seems unnecessary. The earlier you purchase, the lower your premiums and the higher your ultimate payout will be.
Additional Estate Planning Tips and Tricks
You can help preserve your wealth plus cut down on family fights with proper estate planning. One of the first things to do is to take a comprehensive home inventory. Make note of anything with a value of $100 or more and what that value is. If you have family members who will be splitting up your belongings, this will help in making sure they are divided fairly. A home inventory is also beneficial for your home insurance.
- Make note of the total value of all of your investments and savings, as well as your vehicle. This total needs to reflect any debt or money owed, such as the amount still left to pay on your car loan.
- Plan ahead for your care. Discuss with your family where and when you might like to live if you require health care assistance. Also make sure to be transparent about the contents of your will (the executor should be agreed-upon as well), your Personal Directive wishes and any Powers of Attorney that may exist.
- Keep your beneficiary list up to date.
- Visit a financial planner to thoroughly understand how taxes may affect inheritances and your estate. This will help your loved ones in knowing exactly what is coming to them so that they aren’t set up with false expectations.
Trust Lane’s for all of Your Alberta Insurance Needs
At Lane’s, you will be partnered with a specialist who will be your personal contact for all things insurance. Even though we may not be your provider, we are always your source for good information.