Be In The Know: Top 5 Tips When You Buy Life Insurance

Life insurance is a must for the future, but it isn’t something that you should just purchase at random – you need to be prepared. When you buy life insurance, you are doing so to protect yourself and your loved ones in the future, so take the time to get the policy that best suits you.  

Want some advice? Here are our top 5 tips to consider when you buy life insurance: 

1.      Know what you need. This is the most important step, and these needs have to be clear before you even start looking to buy life insurance. Think about what you want the insurance for, who is or may become dependent on you in the future, long-term financial and life goals, and retirement income. A good insurance advisor will ask you about these things so it is important to reflect on them carefully. 

2.      Do your research. Before you buy life insurance it is smart to understand the differences between each policy and what the pros and cons are for each type of insurance. If you don’t understand the differences, ask. Whole life insurance is insurance for your entire life whereas term life covers you for a specific period of time. Other insurance plans may be more suited for investments – you need to be clear on what you are buying and why. 

3.      Don’t buy direct. When setting out to buy life insurance, never go directly to the insurance company – they can only offer you their products, their services and their prices (there is no room for comparison here). Also, because they are more interested in their own needs than yours, they will try to sell you all the unnecessary bells and whistles – don’t buy into this. 

4.      Work with a broker. Instead of going direct, work with an insurance broker. An insurance broker with access to a number of different companies can comparison-shop for you, offering you the policy that meets your needs at the best rate. They will also be able to offer various products, and you can be sure that you are more than just a number – their success is based on your satisfaction – so they need to be sure that you are happy.

5.      Don’t let price dictate your decision. When you buy life insurance, price should never be the determining factor. There are many cheap policies out there but cost often reflects quality – and so don’t go cheap. That being said, the right insurance advisor will be able to explain the differences in price and how each policy works. 

When you buy life insurance, make sure that you are getting exactly what you need. Let these tips guide your search. 

For more tips to use when you buy life insurance, please contact Independent Financial Concepts Group today at 416-849-1653.

Retirement Income Planning: Ask Your Insurance Advisor

Retirement income planning is very important but can feel overwhelming as there are so many considerations. Will you have enough income, do others depend on you financially, who will you live with and will they be able to provide long term care? These are all questions that will have to be answered when you start your retirement income planning.  

Retirement income planning should not be taken lightly – after all, it will be the income that supports you after you stop working – so you should be sure to consider the various different options that exist to give you the most sustainable source of income. These options may include maximizing on your investments and insurance. One important vehicle for retirement income planning is life insurance.  

Life insurance as part of retirement income planning: With a whole life insurance policy, not only do you have life insurance coverage for your entire life, but you can also use that policy to build wealth and generate capital for the future. Whole life insurance combines an insurance policy with an investment component. When you retire, the cash value of your policy can be taken out and can then be used for whatever you need, whether as a loan or just paying for regular monthly expenses. And you have options for paying back this money – making it all the more convenient.

Universal life insurance is also a smart retirement income planning tool. This type of insurance provides income in the future through tax incentives. As a way to grow your savings, universal life insurance works to invest funds in a managed investment, giving you pay-outs you can use once you retire. Like whole life insurance you can use this money for whatever you want/need.

Why do these work? Any money you save for retirement is important, and with the various options out there it can be tough to decide which option will work the best for you. With life insurance, there are many benefits. The forced saving helps many – and if you contribute additional funds monthly, that’s even better. Even more important is the fact that these retirement income planning methods are tax protected – meaning that if you don’t withdraw funds you are not charged, and chances are good that when you retire you will be in a lower tax bracket and thus charged far less.

Retirement income planning is not something that can be accomplished on the verge of retirement. Speaking with an experienced insurance advisor – one who can explain and offer all of the various products to help you save – is a smart way to get started on the road to riches.

For more information about retirement income planning and using insurance as an investment for the future, please contact Independent Financial Concepts Group by calling 416-849-1653.

Life Insurance Basics: How Life Insurance Works

Whether you have a family, a business, or others who depend on you, you already know how important it is to have some financial protection for them. Life insurance is a smart choice – but that doesn’t mean that it is simple. If you want to understand how life insurance works, the first thing you need to learn about are the many different types of life insurance. This blog is going back to the basics – giving you the information you need to make the right decision regarding that financial protection for your loved ones. 

There are three basic types of life insurance – term life insurance, whole life insurance and universal life insurance. 

Term life insurance is the most affordable life insurance product available. It is based on your wants and future goals. The length of the policy is chosen by you, usually from 10-30 years, and over the course of your policy your premiums remain the same. The amount of the policy is also determined by you, based on your budget and what you can afford each month. When the policy ends, you can choose to renew it or let it end.

Whole life insurance is more expensive than term life insurance but this is because it covers you for your entire life, rather than a pre-determined period of time – you are always protected. That doesn’t mean however that you are locked in – whole life insurance is flexible, and you can change the policy if needed as time passes. Your premiums do not change over the course of the policy, and as you pay into the policy, that money gains value which you can cash out or borrow against in the future.

Universal life insurance is a type of life insurance that many individuals use as an investment tool as it carries tax incentives. As you contribute to your policy through monthly premiums, that money grows and gains in value, while also keeping you protected. Additionally, universal life insurance is protected from creditors and probate, meaning no stress for your loved ones in the future.

The type of life insurance you choose will depend on your personal circumstances and both short and long term personal and financial goals. Once you determine the type of life insurance you need, next you will have to consider the type and length of the policy.

Now that you know how life insurance works, your next step is to look at getting some quotes. When it comes to getting quotes on life insurance it is important to strike the right balance between cost and benefits. The best thing to do is to speak with an insurance advisor – speaking with an insurance agent who works for an MGA and not for a specific insurance company will enable you to learn what all insurance companies are able to offer. 

Once you have decided on and purchased a policy, as long as you pay your monthly premiums, you are protected for the length of the policy. If necessary, you will need to renew the policy or depending on the policy, change it as your needs change. In the event of your death, your loved ones (those listed as beneficiaries) will receive the money held within the policy.

To get started on protection for the future, to find out about the different types of insurance or to learn more about how life insurance works, please contact Independent Financial Concepts Group at 416-849-1653.

Personal Insurance Focus: Is Whole Life Insurance the Way to Go?

When it comes to personal insurance, many Torontonians are unsure about what to look for in an insurance policy. Many people are not exactly sure what to expect when searching out policies, or what the difference between policies are. For most people, term life insurance is the type of insurance that most comes to mind – but there are many others that are important to consider as well. One type which is highly advantageous is whole life insurance.

There are many benefits to whole life insurance. If you are thinking about going this route, here are some important things to consider:

Whole life insurance is permanent. When you pay your premiums, your policy continues on, guaranteed – it does not expire. This means that you are protected for your entire life. Unlike term life insurance, which protects you for a term decided upon at the time that the policy is put in place, you don’t need to renegotiate or alter your plan once that agreed upon period comes to an end. You also don’t need to worry about the policy ending and you not being covered.

Whole life insurance premiums won’t increase. When you decide on a policy that meets your needs and the policies are set, these are the same premiums that exist for the entire policy, unlike with a term life policy where premiums increase as you age or if your health deteriorates. When an initial term life insurance policy ends, and you renegotiate, those premiums will be higher because the risks to the insurance company are higher. In a way, this means that you are actually saving money as the whole life insurance policy doesn’t increase even with inflation.

Whole life insurance forces you to save. When you choose whole life insurance and pay the premiums, those policies build up a savings account (also called a cash value) which grows over the years and can be cashed out at retirement or borrowed against if you need to.

Whole life insurance is flexible. Although a whole life insurance policy is permanent, that doesn’t mean that the options you decided upon when you first built the policy are set in stone. Rather, whole life insurance is flexible and can be altered to suit your needs as they change, whether that means increasing your dividends or depositing more premiums.

If you are considering personal insurance for yourself, whole lifeinsurance has a lot to offer. That being said, it is often a bigger premium commitment than term life insurance, primarily because of the additional benefits that do not accompany a term life insurance policy. It is important to speak with an insurance advisor to discuss all of your options and goals to best determine which policy suits your individual needs.

For more information about personal insurance and whether a whole life insurance policy is the way to go for your unique needs, please contact Independent Financial Concepts Group by calling 416-849-1653 or visit www.wecoveryou.ca.

 

 

 

 

 

 

Paying for an Education is Easy with Whole Life Insurance for Children

When your children are born, generally life insurance is not the first thing that you think about. The joy of watching your child learn and grow takes precedence, and thinking positively about the future is usually the only way to go. However, life insurance for children is incredibly important, and so taking out whole life insurance for children when they are young should be a significant consideration for planning for the future.  

Although most people think about life insurance as a way to pay for the costs associated with the death of a loved one – it is not the only reason to acknowledge the benefits of a life insurance policy, especially for children. If a parent has to suffer the tragedy of losing a child, the benefits of a policy that can relieve some of the financial stressors are essential. That being said, purchasing life insurance for children does not necessarily have to be so negative.

Firstly, what is whole life insurance for children? Whole life insurance for children is just like whole life insurance for adults; it is a policy that protects you, holds a cash value that can be borrowed against, and generally is garnered by paying fixed monthly payments set at the beginning of the policy that will not change over time.

Whole life insurance for children is an essential savings tool – especially when planning for future education costs. Every parent wants their child to have access to the best education, and therefore the best jobs that help ensure their future. But this education is costly, and so education planning is critical. Knowing that the average cost of one year of post-secondary education is currently around $12 000, thinking about where that money is going to come from is key.

As a savings account, whole life insurance for children provides you with the ability to continually add to these accounts and watch the balance grow. Then, when the child is old enough, planning to go off to college or university, they can access those savings that you have worked so hard to amass for them.  This saves them from having to take out extensive student loans or O.S.A.P loans to pay for their education. By taking out a policy that provides life insurance for children, you are giving them a chance start their future without a heavy debt load.

These life insurance policies also make great gifts. If you are a grandparent and want to give a gift to a child that will actually benefit them, life insurance for children as a vehicle for saving is a great way to do that. Take away those negative connotations attached to life insurance, and giving a life insurance policy that a child can watch grow over time and eventually use to pay for their education, or for any number of other big purchases, will mean a great deal.

To find out more about life insurance for children and how it can help secure your child’s or grandchild’s future, please contact Gary Mandel at Independent Financial Concepts Group at 416-849-1653 or visit www.wecoveryou.ca.

Whole Life Insurance is a Good Investment Product for Savers

With so many different types of insurance out there, it can often be difficult to determine which policy best suits your needs.  Depending on your current financial situation, as well as your future financial goals, different plans meet different needs. If you are starting out with a young family, term life insurance may suit your financial situation and goals.  If you are in a stable financial position and you are interested in combining life insurance and investments, then you need to know that whole life insurance is a good investment product for savers! 

What is whole life insurance? Whole life insurance is an insurance policy that protects you for your entire life. Unlike term life insurance, which covers for a specific range of time, 10 or 20 years for example, a whole life insurance policy covers you for life. This means that you are protected for your entire life, without having to worry about renegotiating after your term life insurance policy has expired. 

Even better, whole life insurance is not just important as a life insurance plan – it is also a great way to invest and save money for your future!  Whole life insurance is a good investment product for savers because it carries a cash value, is a safe investment vehicle, and because it carries important tax benefits! 

Carries a Value and Can Be Borrowed Against: A whole life insurance policy carries a cash value, and you can use this cash to borrow against. The cash value of your insurance policy can be taken out and used as a loan for other expenses. Also convenient is the fact that you can pay it back in a number of different ways, for example, making regular payments or letting the interest accumulate and having the amount owing subtracted from the benefit paid out in the end, whichever option works for you. 

Safe Investment: As an investment, a whole life insurance policy is also an effective vehicle by which to accumulate wealth and generate value for your future financial needs. Whole life insurance policies are designed to be low maintenance. The accumulated cash value is invested in a diversified investment pool which is managed by professionals, meaning little to no involvement is required by you. Safe and secure, whole life insurance policies are designed to meet your investment AND insurance needs. 

Tax Deduction: If you choose not to withdraw the cash that accumulates, the value of the investment will grow tax free. If you wait and only draw the cash once you retire, you will most likely be in a lower tax bracket than before you retired, and thus will have the chance to keep more of your money!  

These three major reasons why whole life insurance is a good investment product for savers should help you to determine, firstly, what it is you want to gain from your insurance policy, and secondly, how your insurance policy can work for you.  

For more information about how whole life term insurance is a good investment product, or to discuss what insurance policy will suit your current needs, please contact Gary Mandel at Independent Financial Concepts Group at 416-849-1653 or visit www.wecoveryou.ca.

What is Term Life Insurance and Whole Life Insurance in Ontario and What is the Difference?

Life insurance in Ontario can be complicated but it doesn’t have to be. Life Insurance in Ontario is a contract with the insurance policy holder (you) and the insurer (an insurance company). In the event that the insurance policy holder passes away, the insurance company then has to pay an agreed sum of money to the beneficiary. The beneficiary is designated by the insurance policy holder at the time the insurance policy is arranged.  

This can be dicey where a bank is arranging a mortgage protection policy or life insurance coverage to protect a mortgage in the event of the death of the mortgagee because in most cases the bank will want to name themselves’ as the beneficiary. For this reason you are better off to arrange your own mortgage life insurance coverage through an Insurance Broker if you are taking out a mortgage, because you will have more authority as it relates to naming a beneficiary.                       

Life insurance is typically arranged for 2 reasons; protection or investment. Life insurance contracts tend to fall into two major categories:

1.       Protection policies – designed to protect loved ones in the event of a death.

2.       Investment policies – designed facilitate the growth of capital.  

The two most common types of life insurance are: term life insurance and whole life insurance. What is term life insurance and whole life insurance in Ontario and what are the differences between the two? 

Term life insurance coverage in Ontario carries a specified term. The policy does not accumulate cash value. The term life insurance premium will buy life insurance protection in the event of death and nothing else. Another common type of term life insurance is mortgage life insurance, which if arranged by the mortgage holder (bank) will generally only cover the amount of the mortgage and names the bank as the beneficiary in the event of death. Individuals often purchase term life insurance to “protect” their loved ones in the event of death.

What is whole life insurance and how is it different from term life insurance? Whole life insurance provides lifetime life insurance coverage. When purchasing a whole life insurance policy there is no term. Part of the insurance contract mandates that the life insurance policy holder is entitled to a cash value reserve. This cash value can be accessed at any time through a loan against the life insurance policy and are issued income tax free.

There are many advantages of whole life insurance that include: guaranteed death benefits, guaranteed cash values, fixed, predictable annual premiums and mortality and expense charges that will not reduce the cash value of the policy.  

Term life insurance and whole life insurance both carry their respective benefits but the right life insurance coverage for you will depend on your age, the size of your family (do you have dependants), the life stage of your family and your long term financial goals. Your best bet when trying to figure out what life insurance coverage is best for you is to deal with a local Insurance Broker who works with all of the different insurance companies because they cannot only help you determine which product is the best for your personal circumstances but also who is offering the best deal.

For more information about term life insurance coverage and/or whole life insurance coverage in Ontario, please visit www.wecoveryou.ca or contact Gary Mandel at l Independent Financial Concepts Group by calling 416-849-1653.