Insights and Advice

Elder Financial Abuse

We hear and read stories about elderly people being physically abused, but seldom do we hear or read about financial abuse that occurs just as frequently.

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Changing Tax Rules For Life Insurance

By R.A. (BOB) Challis, CFP, RHU, TEP, The Nakamun Group, Winnipeg

On January 1, 2017, Canada Revenue Agency will apply new income tax rules that relate to permanent, participating, whole life, and universal life insurance policies issued on or after that date. Generally, those issued before the beginning of next year will not be affected, unless certain changes are made to the existing policy. The new tax rules will result in possible increased cost of these types of life insurance, higher investment income tax, and less room for tax-advantaged value inside the policy over the long term. Policies owned by a corporation will have lower capital dividend account values, which ultimately lowers the tax-free amounts that are distributed to shareholders.

Tax Changes for Insured Annuities

The taxation of prescribed annuities will also change, neutralizing the benefits of an insured annuity. This currently popular strategy involves purchasing a life annuity in order to generate a guaranteed income for life, and at the same time, acquiring a permanent life insurance policy with a death benefit equal to the life annuity. The intent is for cash fl ow from the annuity to finance the annual premium cost while providing net after-tax income that generates pre-tax annual yield greater than the required annuity withdrawal. At the time of death, the annuity income ceases and the original capital is returned to the estate via the life insurance death benefit. Once the 2017 tax rules come into effect, insurance premiums will increase, as will taxation of prescribed annuities, thereby reducing overall net yields.

Window of Opportunity

if you are thinking of life insurance as a part of an overall estate plan, please talk to your Nakamun Advisor soon to ensure you take maximum advantage of the current tax rules. For some, waiting for the new tax rules might be advantageous.

Mutual Fund Updates

New Tax Rules for Mutual Fund Corporations

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What Your Nakamun Advisor Does For You

For more than four decades, your Nakamun Advisors have been helping you to create, implement, and manage your financial plan.

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Take Advantage of Free Government Money

By Floyd Murphy, CFP, CLU, CHFC, The Nakamun Group, Vancouver

The Federal Government offers a variety of generous grants and funding programs. Once you’ve qualified, applied, and set up the required accounts, funds are automatically deposited. In effect, free money from the Feds. If you qualify, why would you not apply to collect? Following are two examples. Read More…

TFSA “Successor Holder” Designation

By R.A. (Bob) Challis, CFP, RHU, TEP, The Nakamun Group, Winnipeg

Rather than naming your spouse as “Beneficiary” of your TFSA, consider “Successor Holder” as the more appropriate designation. Both are options that are offered for a surviving spouse. Read More…

Budget 2015 Reminders: Save More in Registered Plans

By Garry Keiller, The Nakamun Group, Edmonton

Registered Retirement Income Funds (RRIFs)

The 2015 Federal Budget reduced the required minimum income withdrawals from Registered Retirement Income Funds (RRIFs), effective this year. Decreased minimum withdrawals preserve more of the RRIF’s capital to support income in future years. Therefore, if you don’t need the higher income of the previously required withdrawal percentage, take advantage of the reduced minimum.  Read More…

Consider Health Care Options

By Floyd Murphy, CFP, CLU, CHFC, The Nakamun Group, Vancouver

Our public health care system is amongst the best in the world, despite its many challenges. People with critical health care issues are typically dealt with effectively, and most are pleased and grateful for the quality services they receive in a timely manner. However those waiting for elective care complain bitterly about the long delays for diagnosis and treatment. More and more people are seeking and finding alternative solutions.  Read More…

ESTATE PLANNING – The Art of Dying Neatly

In today’s complicated world of tax and legal structures, a poorly planned estate can create confusion and difficulties for your loved ones at a highly emotional time, and could result in an unnecessarily large portion of your estate paying administration costs such as legal, accounting, or probate fees. Read More…

A Possible Personal Tax Solution for Corporation Owners

By R.A. (Bob) Challis, CFP, RHU, TEP, The Nakamun Group, Winnipeg

Many individuals and families accumulate and hold assets within a private corporation, most often to provide flexibility in managing the amount and timing of personal income taxes paid. While a corporation can be effective for deferring personal income tax, at some point in time, the shareholder(s) will have to withdraw assets. Finding a tax-effective way to do that can be a challenge.  Read More…