Investments vs Life Insurance in Wills

Investments or life insurance — making the right estate decisions for your family is time well spent.

Whether you plan an elaborate portfolio of stocks, bonds and RRSPs or satisfy all their financial needs by buying a life insurance policy is up to you. Whatever you decide, you can be assured your family will be cared for when you draft a valid Will in advance.

Axess Law arranges Wills and estates (Ontario), virtually or in person, 7 days a week.

What goes into writing a basic Will.

What’s the Best Investment for You

That depends on your age, wealth and financial goals.

If you’re just starting out, term insurance can be a good investment. It costs less than whole or universal life insurance policies while you’re young and can be increased or renewed as your income grows.

Later in your career, you may have discretionary income to invest. Putting money into an aggressive investment portfolio may suit your risk taking style. Or you could opt for steady growth over time, by choosing options like RRSPs and mutual funds.
Whole life or universal policies can be the better choice as you age. Premiums stay relatively the same for whole life policies and universal premiums can be negotiated as you go along. Term insurance, on the other hand, can be costly for older investors.

Hiring a financial planner to plot out your strategy is a wise investment in your families’ and your own future.

Who Gets Life Insurance When You Die

Leaving life insurance to your estate, instead of specific beneficiaries, makes it time consuming for your executor to unwind your assets. When you agree to make your estate the policy beneficiary, your estate trustee estimates the value of your life insurance benefits for Ontario probate court and pays estate administration tax on it.

Minors or dependant adult children, or a beloved spouse living on fixed or retirement income, may be counting on your life insurance proceeds to pay their day-to-day expenses. Making your estate the beneficiary may force them to wait for your life insurance benefits to clear probate court before they can be distributed.

Include minors under 18 in Wills.

When you’d prefer that loved ones receive financial assistance right away, specify who you want to receive your life insurance when you sign the policy. Amending a life insurance policy or investment portfolios to remove “estate” from the beneficiary line takes only minutes and is well worth it.

Working on life insurance

Who Pays Taxes on Life Insurance

Your beneficiaries receive the proceeds of your Ontario life insurance policy entirely tax free. Canada Revenue Agency taxes only you on:

  • capital gains or the value of your estate after death
  • interest and dividends you accrue or withdraw while alive
  • or your policy’s cash surrender value if you terminate it.

Your estate trustee files your final income tax return and settles any taxes that may be due by drawing on estate assets or life insurance benefits you pre-arrange for that purpose.

How to file probate papers in an Ontario court.

Deciding on Whole, Term or Universal Insurance

We can’t advise you on whether or how to choose a life insurance policy for your estate. But if you do:

  • Whole life policies are managed by insurance advisors, who pick investments for you.
  • Universal policies allow you to tinker with your investments. How well your policy performs depends on your financial decisions.
  • Death benefits in whole life insurance are predictable.
  • Universal death benefits fluctuate as your investments shrink or expand.
  • Term policies depend on the amount of insurance you purchase.
  • Whole life premiums stay the same for the life of your policy.
  • Premiums for universal policies can be adjusted to suit your budget and the cash value of your portfolio.
  • Premiums for term policies may increase or expire as you age.

The ultimate guide to choosing the type of Will you need.

Discussing with lawyers

Why You Need a Lawyer

Having even a basic, professionally prepared Will can ensure your financial and personal assets are passed on to beneficiaries of your choice. Instead of leaving your estate to an Ontario probate court to sort out, you designate who receives life insurance or investments you may have worked a lifetime to save for.

Axess Law drafts Wills in Ontario that meet legal criteria for making bequests to family members, friends or charities of your choice. No need to worry that your handwritten or holographic Will may be declared invalid by an Ontario probate judge when you have an Axess Law lawyer draft your Will.

Why hiring a lawyer to draft your Will makes sound financial sense.

Recently married, separated or divorced? You could be inadvertently omitting new beneficiaries or leaving assets to a spouse you no longer wish to benefit from your estate just by neglecting to refresh your Will. Writing new Wills is quick and economical at Axess Law.

And if your estate trustee needs probate advice, their first consultation with Axess Law is free!

Flat Fee Legal Services You Can Afford

Axess Law’s flat fee legal services for Wills and estates are affordable and convenient.
Use our virtual lawyers for Wills for secure, confidential video call conferences anywhere in Ontario. If you prefer to meet in person, we have lawyers specializing in Wills in Ottawa or Greater Toronto Area available day or evening, 7 days a week.

You pay just $199.99 and up plus HST for basic Wills or $149.99 and up plus HST each when you and your spouse or partner make mirror or individual Wills at the same time. Include power of attorney for finances (property) and personal care for $249.99 and up plus HST (for virtual legal services) or $299.99 and up plus HST when you make a Will in person.

Make Appointments Online or By Phone

Axess Law locations in Greater Toronto Area and Ottawa have Wills and estate lawyers who can make a new Will every time financial changes to your wealth affect your beneficiaries.

Book virtual video calls anywhere in Ontario or make in person appointments at any of our Axess Law locations. Online booking is easy to do or call our 647-479-0118 lawyer line (toll free to 877-402-4277) and ask for Wills lawyers near you.

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