By Sasha Zhang, CF Canada Financial*
You might never have imagined that the age-old life insurance policy could be an ultimate tax haven. So believes Sasha Zhang of CF Canada Financial, a one-of-a-kind life licensed adviser who specializes in structuring certain life insurance policies that pay good dividends and yield high cash value. “I make millionaires,” Zhang says.
While that’s a rather provocative statement, below she uses an illustration from a life insurance company that she says has been paying an average of 8.4% policy dividend over the past 25 years.
Say you were to invest $20K annually for eight years in your 21-year-old son’s life insurance policy. By age 65 he would have about $1 million in cash value and a $2 million estate (a tax-free death benefit). Since you would own this policy, you would have, during your lifetime, access to the cash in the form of a policy loan. The best feature of this type of asset is that it functions as collateral and continues to appreciate even while the loan is outstanding.
Asked why most people do not know this strategy, Sasha attributes this to two factors: 1. The investment advisers at your local bank may not be life insurance licensed and therefore could not sell this product; 2. Even among those who can, sadly, the majority of life insurance agents don’t have the expertise in this specialized type of planning.
Another little known fact: you may own multiple life insurance policies for yourself, your children and grandchildren, thus creating a family life insurance trust for wealth transfer. Get your estate planning done with named beneficiaries and give the gift that continues to grow and give. Very clever!
Sasha also works with business owners to structure corporate-owned life insurance contracts funded with retained earnings. The generous cash value in such plans can be collateralized for a bank loan to provide income. Jim Pattison signed a letter to Sasha personally endorsing the value of this wealth management method. He attributed his success in securing a loan from RBC to his high cash value life insurance policy, which he used as collateral for funding his first car dealership.
For clients who have no heirs, Sasha helps them secure lifetime income with Guaranteed Investment Funds and other products issued by insurance companies. In addition, she advises clients on leaving legacies to benefit our communities.
To provide the best service to her clients, Sasha treats her clients as friends. Sasha asks clients to call directly at 250-813-2121 or email sasha.zhang@canadafinancial.ca.
Recommended reading:
Live Your Life Insurance – Kim Butler
*DISCLAIMER:
The information and content of article is intended for general informational purposes only. It is not intended to constitute insurance, legal, financial, tax or any other professional advice or services. You should consult a qualified professional advisor before making any decision relating to the information contained in this article.
The materials in this article are provided strictly on a reference basis only. This article makes no representation or warranty concerning the accuracy of the information and content implied or statutory, to the greatest extent permissible by law, including, but not limited to, all warranties or accuracy, completeness, merchantability, performance, and fitness for a particular purpose.