Reduce your risks and improve your returns Part 3 By Perrii Muthuraman




If you have not read part 1 and part 2, check them out first.

Here’s Part 3

This part explains how Participating (PAR) insurance is more attractive in some more instances.

  • When you need to accumulate cash (or huge cash) in your retirement for any purpose, this policy comes handy. Cash value in the policy can be borrowed, during your lifetime. There are several ways to do this, but the preferred way is borrowing from the bank by assigning the policy as collateral security. While you secure the loan, you will continue to be the policy owner. The loan balance is fully repaid at the time of death, from the policy’s death benefit. The remaining funds are paid to the designated beneficiary. You can also borrow from the insurance company.
  • When someone wants to leave a legacy, say to take care of a disabled child, this is one of the best options.
  • Due to family history or other reasons someone could easily become uninsurable. It includes children also. Any insurance policy, taken at a young age overcomes such an adverse situation.
  • For small business owners, it offers all the benefits already discussed and creditor protection also. Thus, this policy helps them to build an enormous cash value protected from their creditors and lawsuits.
  • If you are paying too much tax, this policy effectively offers a tax shelter. In this case, we presume that you have already maxed out on RRSP and TFSA
  • If you own one or more properties, you can’t pass them on your death to your children or any one tax-free. Your estate will be on the hook for capital gains taxes, whether or not your heirs sell the real estate. As part of a comprehensive estate plan, you might consider a permanent life policy with a death benefit designed to offset all or part of your taxes.

Insurance thus can help you build wealth in addition to providing you the “Peace of Mind” in the wealth building process. To know more or to review your current portfolio without any obligation or simply just to have a second opinion, you can contact the author at 416 473 6100 or email:

Actionable ideas:

  1. Review investment portfolio, risks, possible tax payable on death and insurance policies.
  2. Get a second opinion, if necessary. For a second opinion, Perrii is one source.



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