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Our investment and insurance specialists provide expert financial advice to those seeking alternatives to low yielding guaranteed investment certificates, Canada Savings Bonds and other low yielding fixed income investments.
For the conservative or risk adverse investor, who has a minimum of $100,000 of invested fixed income type investments, who is looking for capital preservation and higher interest rates than GICs and other similar products, the "insured annuity" is a solid alternative.
Insured annuities are only purchased with non-registered funds. The insured annuity strategy is actually a two product investment or purchase. The first product is a prescribed annuity which provides investors greater after-tax income and cash flow than can be achieved by investing into guaranteed investment certificates due to the structure of the annuity and the preferential tax treatment of the income distributed. The second product purchased is a life insurance policy with a face amount of the initial investible assets.
The prescribed annuity provides the guaranteed income during ones lifetime whereby part of the annuity income is used to cover the insurance premiums on the life insurance purchased. Upon death, the insurance company pays the death benefit to ones named beneficiaries, heirs or estate.
Contact us to obtain additional information on insured annuities or if you would like to learn more about this strategy that provides higher yields than provided on comparable guaranteed investment certificates.
Insured annuities may be suitable for you if you wish to avoid higher risk investments and would like to generate additional cash flow from your non-registered investments, while at the same time ensuring your equivalent assets are passed on to your heirs. As insured annuities have a life insurance component, you must be insurable to take advantage of this strategy. The insured annuity solution is most appropriate for individuals 55 years of age and older in most cases.
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