Life Insurance: Five things you need to know

People actively buy assets such as home or car against a loan. Most people plan for the worst before buying, However, they don’t take into account their premature death. This can put their loved ones in deep financial problems without any help. We are not advising to stop taking a loan, or you will die early but suggesting that taking a Life Insurance covers you for the worst scenario. Here are a few things you need to know before buying Life Insurance:

  • Working of Life Insurance: Life Insurance is a contract between you and the insurance company. You will pay the company a fee, and in return, they promise to pay back a tax-free lump-sum to your nominee. Hence, if you opt for Life Insurance in Brampton and pay a fee which adds up to 100,000$, then that’s the money the insurance company will pay back with interest upon your death.
  • Cost of Life Insurance: The cost of Life insurance depends upon a lot of factors such as the type of policy, number of beneficiaries, your age, health, sex, drinking and health habits, etc. Many Insurance also asks you to undergo a health checkup to find any life-threatening disease. Hence, if you are suffering from AIDS, you will have to pay more than a healthy person.
  • Term and permanent insurance: There are two main categories in life Insurance: Permanent and Term Insurance. In simpler words, Term insures you for a fixed number of years, i.e., 5,10, or 20 years while Permanent Insurance last throughout your life. Anyone can opt for permanent insurance while term Insurance is popular among senior citizens above 60 years old.
  • Creditor Life Insurance: If you take a loan or a mortgage, the financial institution will offer life insurance called Creditor Life Insurance. Your loan will be repaid after your death. However, the financial institution will pay the loan directly without any involvement with your nominee. This can create a problem; hence, you need to look for more flexible life insurance.
  • Group Insurance Benefits: If you or your spouse has group insurance coverage through your employer. It will also include life insurance, and you can plan accordingly. For example, many group insurances allow you to pay extra to cover additional levels of insurance at very cost-effective rates.

These are the things you need to keep in mind while buying life insurance.

 

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Top Reasons to Start RESP Today

Post-secondary education is costly and since it’s going to be more expensive in the future, you have to be prepared for it. To save yourself and your child from the loads of their education cost, you might want to start a Registered Education Savings Plan (RESP).

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The RESP is created to allow you to save for your child’s education by generating income and gains that are not taxable. When you start the RESP Brampton, you also get benefit of the Canada Education Savings Grant (CESG), under which the Government of Canada contributes an amount to your child’s RESP.

RESPs are highly regulated and we’d like to present you top reasons to take advantage of this solution.

You Want to Save For Your Child’s Education

In 1998, the Federal Government introduced this plan to encourage Canadians to save for their children’s post-secondary education. Under RESP Brampton, parents can contribute a maximum of $50,000 non-tax deductible amount in an RESP per child.

You Want to Save Taxes

Unlike the other schemes (RRSP, TFSA), with RESP you don’t have to pay tax on capital gains and interest income. This helps your savings to grow even faster. You don’t need to pay any taxes at the time of withdrawal because you didn’t receive a deduction on the initial contribution.

You Want Better Options for Savings

Like an RRSP or TFSA, you have many other options to save your hard-earned money. You can invest in stocks, bonds, mutual funds, etc. However unlike other options, RESP Brampton is a risk-free investment.

Invest in Friend or Family’s RESP

RESP doesn’t only allow the parents to invest, but it is open scheme where relatives can also save for the future education cost. You can save for the education of your grandchild, nephew, niece.

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When you open RESP account, remember that you have 60 days to withdraw from the plan. Make sure to read and understand the ‘terms & conditions’ outlined in the short Plan Summary carefully.

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