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Protecting Your Family's Future: How Permanent Insurance Can Help Your Kids Inherit More

Brendan Greenwood, CFP, CIM, B.Comm | September 28, 2023

Life is filled with uncertainties, and as responsible parents, we often find ourselves contemplating ways to secure our family's future. One of the most effective ways to ensure your loved ones are financially protected, even after you're gone, is through permanent life insurance. Let’s explore how permanent insurance can safeguard your family's financial well-being and allow more money to flow to your kids instead of paying it out in taxes.

Permanent life insurance, often referred to as whole life or universal life insurance, is distinct from term life insurance in that it provides coverage for your entire life, as long as the premiums are paid. This coverage comes with several benefits that can play a crucial role in securing your family's future:

Tax-Advantaged Savings: Permanent insurance policies typically come with a cash value component that grows over time, often on a tax-deferred basis. This means your money can accumulate without being subject to annual income taxes, allowing you to build a substantial financial cushion.

Estate Planning: Permanent insurance can be a vital component of your estate planning strategy. When you pass away, the death benefit paid out to your beneficiaries is generally tax-free, ensuring that your loved ones receive the full amount without any deductions.

Protection Against Market Volatility: Unlike other investment vehicles, the cash value component of permanent insurance is shielded from market fluctuations. This stability can provide a sense of security, especially during turbulent economic times.

Legacy Planning: Permanent insurance allows you to create a legacy for your children and grandchildren. You can designate them as beneficiaries, ensuring that they receive a substantial financial gift when you're no longer around.

A financial advisor can help you determine the most effective way to implement permanent insurance into your financial plan based on your circumstances.

Brendan Greenwood is an insurance advisor with Pelorus Transition Planning working to build financial independence and security for professionals, incorporated individuals, business owners, and their families through comprehensive planning and insurance strategies.

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