Dare to dream

Everyone has dreams of what their retirement years will be like. Will you be hiking in the Himalayas or sunning down south? Where will the money come from to fulfill these retirement dreams?

Before we answer that question, let’s look at how much money you will need to fund your retirement. To maintain your current lifestyle, the general rule is that you should aim to replace 70% of your pre-retirement income. However, hiking in the Himalayas may run you a bit more than your current lifestyle costs.

Supplement your retirement income

Now that you know your savings, CPP and pension income may not be enough to fund the retirement of your dreams, you may want to consider a universal life (UL) insurance policy as an additional vehicle to help protect what you have today, while supplementing a more comfortable tomorrow. Talk to your advisor about how a universal life policy can provide you with a potential source of supplemental retirement income. What else can you do?

By overfunding your UL policy, you can provide yourself with Living Benefits. Living Benefits are a tax-free§(4) and surrender charge-free benefit||(5) that you fund yourself through savings within your UL policy and can be accessed if you incur an occupational disability, or a disability caused by one of 26 critical illnesses, including the need for long term care. Living Benefits are ideal in your retirement years since permanent critical illness insurance or disability insurance may be costly and hard to qualify for and may include features you do not need. For more information about ivari’s universal life products and Living Benefits, talk to your advisor today to discuss the full details of these features as outlined in your contract.

*(1) Source: https://www.fin.gc.ca/activty/pubs/pension/ref-bib/horner-eng.asp. back

†(2) Canadians Saving for Their Future: A Secure Retirement – Final Report of the Standing Senate Committee on Banking, Trade and Commerce – October, 2010 - Page 20. back

‡(3) Source: https://www.retirementadvisor.ca/retadv/apps/articles/articles.jsp?articlePage=Companypension&learningMenu=articles. back

§(4) Under the Income Tax Act (Canada) and at the date of publication of this website, the receipt of Living Benefits is not currently taxable. ivari does not guarantee nor is it responsible for the tax treatment applicable to this policy feature. Please consult your legal or tax advisor for an opinion on this matter in relation to your particular circumstances. back

||(5) For information on what qualifies as a disability and for the determination of the benefit amount available to you, please refer to the contract provisions. Disabilities caused by pre-existing conditions do not qualify. back