Tax Free Money

Did you know that most insurance coverage amounts such as Life insurance and Critical Illness insurance are paid out "tax free" at time of claim? One of the easiest methods to accumulate money in your estate is to purchase one of these insurance products.

With our federal and provincial tax systems, it's very difficult to accumulate large sums of money. It also takes a long time to accumulate it. So quite often, it's not available when you need it most.

By using financial products such as Life and Critical Illness insurance you can protect what you've already got, and accumulate more on a tax free basis. Here are some examples:

Let's assume that a 65 year old male non smoker requires $500,000 to cover the cost of hospital and medical bills related to a critical illness plus pay off some debts.

In order to accumulate $500,000 at age 65, the male would have had to start saving money at age 40. Assuming various tax brackets and an average rate of return of 8%, here is what he would have had to save each year.

Conversely, if he bought a Critical Illness policy to age 75, it would cost him $4,635 per year over the 25 years or $115,875 in total. If he added a Return of Premium rider to the same policy it would cost him $6,261 per year or $156,525 in total.

Critical Illness insurance (and other insurance products) provide a very cost-effective way to ensure you have tax-free money available when you need it most.

Learn more about Critical Illness insurance or contact Barrons to arrange a no obligation consultation.

This example is for illustration purposes only, while every attempt has been made to ensure the accuracy of this information Barrons or its affiliated companies cannot be held liable for errors or omissions. Actual numbers at time of illustration may vary.