Insights and Advice
2016 in Review
BY SHAUNA BL ACKBURN-COOK , BCOM, THE NAKAMUN GROUP, EDMONTON
Two standout events — Brexit and the US election — will mark 2016 in history. In both cases, equity markets reacted or overreacted sharply to the downside and then returned to pre-election levels. Both decisions will have long-term economic implications domestically and globally. The extent of the change resulting from each vote remains to be seen. Both decisions have also triggered greater uncertainty. Read More…
Canada Pension Plan Complexities Part II
In the fall edition of our newsletter, we covered Canada Pension Plan (CPP) contributions, retirement pensions, and disability benefits; and this time, we are dealing with pension sharing and benefits when a CPP contributor dies. Read More…
Cover Your Bases … With a Power of Attorney and a Representation Agreement
FLOYD MURPHY, CFP, CLU, CHFC, THE NAK AMUN GROUP, VANCOUVER
Every adult should have an Enduring Power of Attorney and a Representation Agreement.
While each jurisdiction has its own terminology and rules for these documents, essentially an Enduring Power of Attorney enables you to give one or more people of your choosing the authority to make financial decisions on your behalf, should you become mentally or physically incapable of making those decision on your own, while a Representation Agreement covers health and medical decisions. Read More…
Before The End of The Year…
While the end of the year might still be months away, you should be thinking about strategies that could generate tax advantages or might simply be prudent.\
Health Care Availability and Accessibility For Travellers
As global travel expands to the far reaches of the world, be aware that medical care outside of Canada is increasingly uncertain.
Canada Pension Plan Complexities
Most Canadians over the age of 18 are impacted in some way by the Canada Pension Plan (CPP), either as a contributor or benefit recipient.
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.
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
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.