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Supplement Your Retirement
Income (and Save Tax) Using Universal Life Insurance Strategies
Supplement Your Retirement
Income (and Save Tax) Using Universal Life
Insurance
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Chances are, when
you think about saving for retirement
you concentrate on accumulating
registered assets in the years leading
up to retirement. But what about the
years after retirement?
Many people do not realize that income
drawn from a registered plan is subject
to annual taxation. How can you continue
to defer taxes on your savings during
your retirement years?
There is a solution, which I call the
Retirement Income Maximizer, and it will
appeal to you if you generally
contribute the maximum to your RRSP and
still have a sizable sum of money to
invest for the long term.
The way it works is simple. You invest
your non-registered assets into a
properly structured Universal Life (UL)
policy. Unlike regular non-registered
investments, investments in a Universal
Life plan are tax-deferred (just like an
RRSP), as long as they are held in the
plan.
Once you retire, instead of using your
RRIF to provide the bulk of your
retirement income, you only withdraw the
minimum. To make up the shortfall you
then access the money built up in the UL
policy using a loan or series of loans
using the policy as collateral. Unlike
income from a RRIF that exceeds the
government-prescribed minimum, income
from a bank loan is not subject to
taxation. Many banks will loan up to 90%
of the Cash Surrender Value of your
policy and will not require repayment
until your death, upon which the loan is
repaid using the death benefit of the UL
policy. As a further benefit, any death
benefit remaining after the loan is paid
goes to your heirs.
To see how well this strategy will work
for your specific situation, please give
us a call at
1-877-628-6762
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