by Scott Willman, Senior Associate Advisor
When we imagine our future selves, ten or twenty years from now, we envision what we’re doing, who we are with, our health and the big picture of what our lives are like. It is equally important to give thought to the financial tools we are using along the way that can maximize our savings and be as tax efficient as possible. Most of us have some thought of leaving money to the next generation, and how we can set them up for financial success with things like paying off school debt, business start up funds, housing costs, etc. but we need to think strategically.
Whole Life Planning
As part of my client relationships, I am always encouraging them to imagine their whole life as part of their financial planning and journey so I can hold them accountable to their goals.
When you start thinking about your financial future, you really need to establish the following:
What is your cash flow?
How does that measure up against assets to project retirement income?
How much will you get from government or employer pensions?
What is the difference?
Where is it coming from?
If you don’t have the answer to these questions or haven’t looked at these within the last 12 months, this is an exercise you need to undertake immediately with your financial advisor.
Having a proper understanding of your cash flow and projected spends into retirement are critical to understanding your liquidity and developing strategies to most effectively manage this.
What is Liquidity & Why Does it Matter?
Liquidity is your access to cash at any time. The reason it matters is because life can be unexpected and there are certain things we simply can’t prepare for. However, it is also important to understand that just as you can have too little, you can also have too much. Too much cash not structured effectively means significant tax implications long term.
Working with someone like me, together we will identify your net worth, expenses and net income, you’ll know how much you’ll need to allocate for lifestyle and what’s left. If you know you are going to be leaving an estate to your children, there is a more efficient way to do this, where you can pass along more, pass it faster and be the most tax efficient.
While there can be many misconceptions around insurance, such as it only benefits those you leave behind, proper financial planning can have significant impact on tax implications and future liquidity. While there are many reasons why no one likes to talk about life insurance, it’s important to understand how it works.
Financial Savings Through Insurance
Insurance isn’t just about benefiting someone else; it can be a financial benefit to you as well. This is one financial tool you can use to spend more and give more. After all, you can’t take it with you. It is also insulating you and your family for the future, unexpected events and creates a legacy to be used by those you leave behind.
We all know life insurance will help our loved ones, but what happens if you need it during your lifetime? Let’s look at the chart below so you can really understand how this financial tool works.
The Growth of Assets without Insurance Column demonstrates standard growth of assets without insurance and shows that if you do nothing your money will still grow, but is there a better way? If your objective is to enhance your tax-free savings for the next generation, you can clearly see in the Total Estate and Family Advantage Columns the significant impact insurance can have to make your money go further.
This money can be drawn done by you at any time, or can be used to gift to your children, beneficiary or a cause that is close to your heart to leave a lasting legacy. While tax implications vary depending on what savings vehicle you are using, the fact remains, life insurance is the most efficient way to transfer wealth while still having liquidity for the present.
 SCOTT WILLMAN Senior Associate Advisor Under his expertise and guidance, Scott has developed meaningful and long-term relationships with his clients with his personable and professional manner. His business is built on relationships of open communication and trust and he is continually recognized for providing effective financial solutions and delivering the highest level of personalized service.
Scott is dedicated to meeting the specific financial objectives of his clients and enjoys the strong relationships he has built. He is a qualifying member of the Million Dollar Round Table (MDRT), the premier association of financial professionals and is proud to follow both his grandfather and father in the financial services industry, building upon 65+ years of experience.
Scott is the primary advisor in our Durham regional office and lives in the area with his wife and two sons. He is an active member of various community associations. CONTACT ME |
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 Founded in 2012, by Mike D’Alessandro and Darrell Wade, Park Place Financial grew quickly to become one of Central and Eastern Ontario’s top wealth and estate planning firms. Its mission, to be known for excellence in helping grow and preserve the wealth accumulated by family business owners and entrepreneurs across multiple generations. In 2018, Terry Windrem Insurance Agencies joined Park Place Financial, firmly positioning the business as an industry leader in wealth and risk management. |
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