Search Results

By Sarah Chisholm, BA Financial Advisor, O’Farrell Wealth & Estate Planning | Assante Capital Management Ltd. The Christmas Season is a time for family gatherings and celebrations, good food and presents. We all get joy from giving to our loved ones and those in need. Let’s grab your favourite cup of tea or coffee and discuss ways to give in 2022. As parents and grandparents, we often find it challenging to come up with ideas for gifts for our children or grandchildren. Do they really need more clothing or toys? Consider making an investment into their Registered Education Savings Plan. RESP contributions up to $2,500 per year (subject to CRA guidelines) are eligible for a 20% Canada Education Savings Grant. Giving your grandchild $100 for their RESP account could earn them an additional $20 in government grant. What about gifts for our adult children or our siblings? Our adult children or our siblings are often named the executors of our estates. While they are often willing, being an executor can prove to be quite complicated for our loves ones when we eventually pass. One major hurdle of estates can be the presence of physical share certificates. A loved one may have passed away while still holding those shares and the executor is then faced with a mountain of paperwork to have the shares re-issued in the name of the estate. This includes working with a brokerage to deposit the shares before being able to sell or distribute those shares to the beneficiaries and file the realized capital gains or losses with the CRA. If you have physical share certificates filed away in a safe or lock box, take the time to pull them out and get them deposited into an investment account that is easier to manage. Dealing with stock certificates now will save your executors a major headache down the road – a truly wonderful gift. We all have family and friends who truly need nothing. Consider making a charitable donation in their name. Take the time to consider what charity or foundation they truly value and then send in your donation. Many charities will then send a notification to your loved one to let them know a donation has been made in their honor. For tax purposes, make sure your donation is made before December 31, 2022 so you can claim the tax credit on your 2022 tax return. Finally, as you cross the final items off your list for this holiday season, consider making those purchases from locally owned businesses. Our community has an amazing wealth of products and services – spread some cheer and support the local community. We welcome questions so please reach out! See our ad in this week’s North Grenville Times and follow us on Facebook @OFarrellWealth. Sarah Chisholm is a Financial Advisor with Assante Capital Management Ltd. The opinions expressed are those of the author and not necessarily those of Assante Capital Management Ltd. Please contact her at 613.258.1997 or visit ofarrellwealth.com to discuss your circumstances prior to acting on the information above. Assante Capital Management Ltd. is a member of the Canadian Investor Protection Fund and the Investment Industry Regulatory Organization of Canada.

A cautious start to the month of November after the FOMC’s (Federal Open Market Committee) meeting and policy rates guidance on November 2nd proved to be short lived. Investor enthusiasm was re-ignited after the US inflation report showed that the headline inflation in the US declined even lower than the expected rate of +7.9% to +7.7% from the previous +8.2%. The report for Canada showed that inflation in the country stayed flat at +6.9%, keeping in line with the expectations and last month’s readings of +6.9%. Investor enthusiasm grew on expectations that if inflation has taken a turn, the case for the pace of policy rates hikes to decline in the coming months has become stronger. The fixed income asset class also gained after bond yields at the long end of the curve declined. The inversion of the yield curve, however, deepened after bond yields at the short end of the curve continued to advance given that the policy rates are still expected to advance, albeit at a lower pace. Historically, an inversion of yield curve has been usually followed by an economic recession (See Figure 1). Given that the extent of current inversion is very deep and the last time this level of inversion was witnessed was during the late seventies or early eighties, the argument that the much-anticipated recession in 2023 will be deep and long, has gained ground. The conditions such as a spike in commodity prices, increasing interest rates, along with a yield curve inversion, do indicate that a recession is on the horizon. However, we believe the jury is still out the on the length and extent of a recession. The sooner that inflation falls back to targeted levels, the less need there is to keep interest rates in the restrictive territory for long. In our view, this lowers the chances of a deep and prolonged economic contraction. Figure 1: US yield curve inversions and recessions (Jan-1977 to Nov-2022) The impact of higher interest rates on the real economy is now increasingly becoming visible and will eventually manifest as lower earning expectations for corporations. The news of mass firings and hiring freezes by large corporations has hogged the limelight in the recent weeks. This indicates that the unemployment rate will increase, which, on one hand this means lower inflationary pressures, and on the other hand, means a tough operating economic environment. The Institute of Supply Management’s (ISM PMI) manufacturing Index slipped into contraction territory (49 in November from 50.2 in October). A reading above 50 indicates the manufacturing activity is expected to expand and a reading lower than 50 indicates the manufacturing activity is expected to contract. Notwithstanding the deteriorating fundamentals, having been fixated on inflation and policy rates through the year, the markets are now staging a relief rally as inflation seems to have finally taken a turn and the Central Banks have begun to signal their willingness to reduce the pace of interest rate hikes. This gift could not have come at a more opportune time as investors have been waiting for the Santa Claus rally in anticipation. We wish our readers a Merry Christmas and Happy Holidays.

By Cyndy Batchelor, BCom Financial Advisor, O’Farrell Wealth & Estate Planning | Assante Capital Management Ltd. As the holiday season nears, we all search for ways to create special memories for our families, children, and grandchildren while still staying within our budget. It is important to remember that you do not have to “break the bank” to have a good holiday. There are many Holiday activities you can take part in that that cost very little: Check out the local Christmas Parade and enjoy the wonder of the season. Take a Holiday Lights Tour – you can attend an official one at a cost per car or set your own route. Finish the night off with a cup of homemade hot chocolate and cookies. At home movie nights – it is always fun to break out the pjs and popcorn and get cozy on a cold winter night with some Holiday Classics. A Visit to Santa – many local markets feature a Santa your family can see without the need to brave the busy mall. Family Baking – enjoy a day baking Christmas Treats. This is not only budget friendly, but it is also a fun activity where life skills can be incorporated. There are many budget-friendly gift ideas that can bring joy to those you love: Homemade presents – if you are artistic or fantastic in the kitchen, consider making something for the people on your list. RESPs – if you have grandkids/nieces or nephews and they have or get everything they need, consider contributing to their Registered Education Savings Plan. Be sure to remember these budget tips when planning your holiday shopping: Prioritize the wish list – it isn’t necessary to buy everything on someone’s wish list – make sure to manage their expectations. Start your holiday shopping early. You can budget a small amount every month so that you are not looking at a big bill in December or January. Shop for sales – Black Friday and Cyber Monday can be a budget shoppers dream. Pay in cash – this will help to not rack up the credit cards and, in turn, credit card interest. Remember, Holiday memories are made up of the fun things we do and the people we spend our time with. This is what makes the season so special. I wish you all a very Happy Holiday. We welcome questions so please reach out! You can also follow us on Facebook @OFarrellWealth. Cyndy Batchelor is a Financial Advisor with Assante Capital Management Ltd. The opinions expressed are those of the author and not necessarily those of Assante Capital Management Ltd. Please contact her at 613.258.1997 or visit ofarrellwealth.com to discuss your circumstances prior to acting on the information above. Assante Capital Management Ltd. is a member of the Canadian Investor Protection Fund and the Investment Industry Regulatory Organization of Canada.

Cyndy Batchelor, BCom Financial Advisor, O’Farrell Wealth & Estate Planning | Assante Capital Management Ltd. The cost of daily living is getting more expensive, and many use their Credit Cards to carry these increased costs. Carrying a balance on a credit card will incur interest charges that can take years to pay off. As credit card debt can hold an interest rate of up to 24%, the only way you will ever get ahead is to commit to never carrying a balance. That does not mean that you need to give up using your credit card, it simply means you should be paying off your full balance by the due date each month. Credit Cards can help you build up good credit and give you rewards like dividend dollars, travel miles, or points to redeem for free items. This can help you save money in the long run. If they are used responsibly, credit cards can come with many incentives. Here are some tips for using your Credit Cards to their best advantage: Set a credit limit that you can pay off Make sure you can pay off your credit card each month by the due date. Whatever you are charging to the card needs to be within the budget so that you can afford to make your payment ON TIME. If you go beyond your limit, stop using the credit card. Track your spending Tracking your spending is so important. You can do this by reviewing your credit card balance regularly, setting up a spreadsheet, utilizing an app, or through an alert on your phone. You may even want to make additional payments against the card to ensure the balance does not get out of hand. Live on a Budget Now that you have set a limit and are tracking your spending, ensure you are living up to your budget. Make sure your income is more than your expenses. Allocate your income to 50% needs, 30% wants and 20% savings. If you need to revise your budget and drop some of the wants or sundries, as I like to call them, then revise as needed until your numbers are in line. Make your payment Automatic You can set up your bill payments, including your credit card, to be paid automatically. This will help you to keep to your monthly budget. It will also help you to ensure you are always paying off your credit card. Build yourself an Emergency Fund To avoid a sticky situation, start building an emergency fund. Emergencies like car repairs, a job loss, or a leaky roof can max out your credit card if you do not have emergency funds set aside. This can increase your overall debt. Ideally, your emergency fund will cover four to six months of living expenses. If you do have to use your emergency fund, make sure you plan to build it back up again. A credit card can be a great financial asset as a tool to build credit and earn rewards. We welcome questions so please reach out! See our ad in this week’s North Dundas Times and follow us on Facebook @OFarrellFinancialServicesInc. Cyndy Batchelor is a Financial Advisor with Assante Capital Management Ltd. The opinions expressed are those of the author and not necessarily those of Assante Capital Management Ltd. Please contact her at 613.258.1997 or visit ofarrellwealth.com to discuss your circumstances prior to acting on the information above. Assante Capital Management Ltd. is a member of the Canadian Investor Protection Fund and the Investment Industry Regulatory Organization of Canada.

By Sarah Chisholm Financial Advisor, O’Farrell Wealth & Estate Planning | Assante Capital Management Ltd. As we celebrate small business week it is a great time for business owners to start thinking about retirement. You have built a successful business – when do you want to take a step back, and how will you implement that transition? Every business transition is unique so please grab your favourite cup of tea or coffee and let us consider. Transitioning a business is typically a multi-layer process. A Financial Advisor can work as your quarterback to direct the transition and bring in key players such as your accountant, lawyer, and lender to get everyone on board. Transitioning a business can take a variety of forms. You may sell outright to a third party, negotiate a deal with a current employee, wind down the business, or keep the business going by transitioning to a family member. If you are in certain industries like farming, a family transition can often be implemented tax efficiently with a farm roll over. In all cases, your succession team will provide guidance on how to proceed in the most tax efficient manner and will provide solutions to smooth the transition. Knowing who the business will transition to is often the easiest part. The hardest part may be the transition into retirement – the personal side and the financial side. On the personal side, business owners often connect their identity to the business itself. They see themselves as the business. What happens when you are no longer the business owner? Identifying retirement goals, activities, and networks is part of process to rebuild your personal and family identity. Look at the hours you currently devote to your business and consider how will you fill your time in retirement. As you focus on your goals for retirement, it will help your Financial Advisor build a strategy for your retirement cash flow. Having a good idea of the daily cashflow, vacation, large purchases that you expect to make over the first 5 years of retirement can bring clarity to the investment goals that need to be implemented for retirement. Are there enough savings in retirement savings plans and tax-free savings accounts or other assets to fund the retirement goals? What after tax amount do you need to net from the sale of your business to fund your retirement goals? Having a number in mind can help you weed out lowball offers from potential buyers. For those business owners transitioning to family, another aspect comes into play – fairness. When businesses are transitioned from parents to children it is often done at some sort of discount, potentially with promissory notes forgivable on the parents passing. If there are multiple children in the family but only one is buying the business, it is important to look at the estate and legacy goals. Most business owners with multiple children understand that you can be fair to all your children, without necessarily being equal. Building assets outside of your business can help with this equalization dilemma. Real estate, investment accounts, and permanent life insurance can all be used as part of the estate equalization process for the non-business children. The transition process can be challenging but remember the reason it is challenging is because you’ve built a successful business and significant wealth. Starting to plan early is important. Put your professional team on notice and get them started on a business transition plan for retirement. Sarah Chisholm is a Financial Advisor with Assante Capital Management Ltd. The opinions expressed are those of the author and not necessarily those of Assante Capital Management Ltd. Please contact her at 613.258.1997 or visit ofarrellwealth.com to discuss your circumstances prior to acting on the information above. Assante Capital Management Ltd. is a member of the Canadian Investor Protection Fund and the Investment Industry Regulatory Organization of Canada.

By Cole Seabrook Financial Advisor, O’Farrell Wealth & Estate Planning | Assante Capital Management Ltd. The Canadian Government is introducing a new investment account to help young Canadians achieve their first-time house purchasing goals. Have you heard about the Tax-Free First Home Savings Account (FHSA)? The Canadian Government is planning on releasing the FHSA in 2023. The intention is to help Canadians save for the purchase of a home while providing tax benefits and tax relief when it comes time to withdraw the funds for the purchase of a home. Let’s highlight the degree of flexibility the account will bring to prospective homebuyers. Many First-time homebuyers have taken advantage of the ability to access up to $35,000 of their Registered Retirement Savings Plan (RRSP) to purchase their first home. This is a tax-free benefit that they can use to help with their down payment. This provides them with the taxable deduction when money is contributed to the RRSP and grants them access to a portion of a down payment. The one catch with this program is that once funds are taken from their RRSP to help with the down payment of a house, they must pay back the money borrowed from their RRSP within 15 years from the withdrawal date. This can sometimes create a budgeting issue. The individual has a mortgage as well as a repayment to their RRSP. In the past, there has been much debate surrounding saving for a down payment in a Tax-Free Savings Account (TFSA) as opposed to using a Registered Retirement Savings Plan. As each individual has a different financial situation, at the end of the day, it depends on many variables such as an individuals taxable income, contribution room to said account, and budget. This is where the Tax-Free Fist Home Buyers Account will benefit young individuals. The FHSA account has the benefits of both a Tax-Free Savings Account and a Registered Retirement Savings Account where contributions to the FHSA are tax deductible and the withdrawal is tax-free. The beauty of the FHSA account is that you do not have to pay back the personal loan into the FHSA and the withdrawal comes to the account holder tax free. Like TFSA’s and RRSP’s, there will be contribution limits. The initial thought is said to be $8000.00 annually with the ability to carry forward room. This will have a major impact for young individuals and couples when it comes time to save for the purchase of their first home. We are always open to questions, if you would like to learn more about the FHSA please feel free to reach out! Follow us on Facebook @OFarrellWealth or visit ofarrellwealth.com. Cole Seabrook is a Financial Advisor with Assante Capital Management Ltd. The opinions expressed are those of the author and not necessarily those of Assante Capital Management Ltd. Please contact him at 613.258.1997 or visit ofarrellwealth.com to discuss your circumstances prior to acting on the information above. Assante Capital Management Ltd. is a member of the Canadian Investor Protection Fund and the Investment Industry Regulatory Organization of Canada.

By Cole Seabrook Financial Advisor, O’Farrell Wealth & Estate Planning | Assante Capital Management Ltd. When speaking with individuals regarding their financial plans, many like to focus on the wealth management portion. Although savings and investments are key components of financial planning, many individuals neglect an incredibly crucial factor - Disability and Critical Illness Insurance. As individuals, we do not like to think about the worst-case scenario, but it is a consideration that should be addressed and planned for. Should anyone become disabled or critically ill at some point during their working years, this could have a major impact on many aspects of their financial situation. It could become difficult to cover their living expenses, mortgage payments, taxes, and other bills. On top of adding pressure to their financial situation, job loss can also cause stress on family dynamics. Let us look at how the two different types of insurance can protect individuals against potential job loss due to disability or illness. Disability insurance: In the event an individual becomes disabled, a private disability plan provides a monthly tax-free income – potentially for the entire duration of time that they are unable to work, or possibly until the age of sixty-five. There are many ways to structure this type of insurance to meet an individual’s needs. Although many employers have this type of coverage in their Group Benefits plan, the coverage amount is not always adequate to maintain the employee’s standard of living. This is where a personally owned Disability Insurance policy can help to top up the coverage offered through an employer. Critical Illness insurance: Like Disability Insurance, Critical Illness insurance pays out a tax-free benefit. The difference between the two policies is that, with Critical Illness, the individual receives a lump-sum amount. The definition of each policy can vary, most covering up to twenty-five illnesses such as life-threatening cancer, heart attack, and stroke. If one becomes ill, receiving the benefit would allow an individual to stay on track with their financial plan while covering their living expenses and allowing them to focus on the road to recovery. Although no one wants to consider the “what ifs?”; imagine the comfort in knowing that in the event of a tragedy you and your family would be able to manage the financial stress with the help of an insurance policy. Insurance can play a key role in an individual’s financial plan. Your ability to earn an income is one of the most significant assets and placing insurance on that asset is of utmost importance.

By Cyndy Batchelor Financial Advisor, O’Farrell Wealth & Estate Planning | Assante Capital Management Ltd. I often get questions about retirement planning. The most frequently asked question is “do I have enough money to retire?” This question cannot be answered with simple yes or no as everyone has different spending habits, time horizons, risk and investment goals, and estate planning ideas. As we approach the New Year, I want to bring this topic to the forefront of your minds. Here are some questions that you should be considering. Q: When do I want to retire? A: Sometimes this is based on a pension (i.e. 25 or 30 years of service) and sometimes this is based on a savings goal (I need to save $1Million Dollars). Either way, you should be sitting down with your Advisor to review your plan on an annual basis. Life does not always go as planned - there are ways to ensure that your goals can be met even when life throws you a curveball. The earlier you plan, the more cost effective it is to add Critical Illness, Disability, and Life Insurance options to your overall plan. Q: What Is My Retirement Spending Goal? A: Anything you want! Don’t forget that this is individualized to you, and you need to make an honest budget. If you retire early, you may want to travel more and this can be costly. As you get older, you may have health concerns that consume your income/savings. Expect to spend about the same amount in retirement as you do while you are working – it is just going to be allocated differently. Q: What is my risk tolerance and what are my investment objectives? A: Again, you need to be comfortable with your investments, but you also need to be realistic with your expectations. A proper portfolio allocation that balances your risk aversion and return objectives is very important. It is also important that you don’t micro-manage your portfolio daily or even monthly. It is time in the market not timing the market. Your retirement is likely going to last 20-25 years – stay the course, meet with your Advisor, review your plan and investment strategy, and perform the recommended rebalancing. Q: What are my Estate Objectives? A: There are a few things to consider when we look beyond your retirement to your Estate. You might be someone who wants your last dollar to be spent the day you die, but more than likely you have an objective for your Estate – protecting your loved ones and/or donating to a charitable cause. In order to minimize your taxes in both your lifetime and at your death while ensuring your wishes are met, Estate Planning needs to be considered in your Retirement Planning. If you are looking for more information about retirement planning, contact your financial advisor.

By Sarah Chisholm Financial Advisor, O’Farrell Wealth & Estate Planning | Assante Capital Management Ltd. Small and medium-sized Business Owners play a crucial role in the community. They create employment, drive tourism, grow the economy, and often support local charitable organizations. Business Owners want to grow and be profitable. Re-investing in your business might give you the best initial return – but we know that life can throw curve balls such as Covid and Recessions. When planning for retirement, Business Owners should consider the following diversification strategies: 1. Canada Pension Plan – if incorporated, have you considered drawing a portion of your income as salary and the remainder as a dividend? Pulling salary up to the yearly maximum pensionable earnings allows you to maximize your yearly CPP contributions. CPP could be used as one pillar for your retirement income. 2. Old Age Security – are you eligible? Will you be hit with the clawback? 3. Investment Accounts - Registered Retirement Savings Plans, Tax Free Savings Accounts, and other investment accounts may not be appealing if your business typically outperforms the Canadian and U.S. stock market. However, consider that these accounts could be used as a buffer for when things go wrong – short term shutdowns or a business sale not generating the proceeds expected. Spousal RRSP accounts can also provide income splitting options. 4. Critical Illness Coverage and Disability Insurance: these protection strategies can aid in your ability to generate an income while working. They can also be used to create income for later in life. For example, the return of premium option on a critical illness policy could be lined up so that you have an injection of cash right at retirement. 5. Life Insurance – should be used for risk mitigation while living, but permanent insurance should also be considered as a retirement and estate asset. The cash surrender value of a participating whole life insurance policy could be leveraged in retirement as source of income. The policy death benefit (minus any leveraged portion) could be used as an estate asset – generating cash for the corporation or estate to pay taxes, liabilities, or to create estate equalization for children not involved in the business. Consider a business that is transitioning from parent to child. How does the business redeem the parent’s shares? Do they sell active business assets or does an insurance death benefit create an influx of funds. 6. Real Estate –farmland, residential rental properties, or commercial buildings can also add diversification to your portfolio. They can create rental income for retirement or could be sold off to fund retirement living. 7. Other ventures – private equity or additional business ventures could provide additional diversification to your retirement plan. 8. Finally, as a business owner you need to take a serious look at the business(es) that you run. Can this business be sold to a third party or will it be wound down at your retirement. Are there pieces of equipment or machinery that would be sold? Do you plan on transitioning the business to a family member at a discounted value? Working with your professional team (Financial Advisor, Accountant, Lawyer, Lender, Business Valuator etc.) can help you answer some of these questions. Diversification provides flexibility in your retirement. It allows you to grow your net worth beyond your business and creates opportunity for new ventures. Every retirement and estate strategy is unique – take the time to sit with your Financial Advisor to establish goals and strategies. Bring in your entire professional team to review all the tax and legal implications and then begin implementing your diversification strategy. Sarah Chisholm is a Financial Advisor with Assante Capital Management Ltd. The opinions expressed are those of the author and not necessarily those of Assante Capital Management Ltd. Please contact her at 613.258.1997 or visit ofarrellwealth.com to discuss your circumstances prior to acting on the information above. Assante Capital Management Ltd. is a member of the Canadian Investor Protection Fund and the Investment Industry Regulatory Organization of Canada. Insurance products and services are provided through Assante Estate and Insurance Services Inc.

The conditions were just right for a bounce back in equity markets during the month of October. Factors such as a) fourth quarter typically being strong for the markets, b) extreme market pessimism with oversold conditions, c) rising expectations of a pivot by Central Banks on the pace of rate hikes, and d) better-than-expected third-quarter results from companies in general. These factors, together, worked in favor of equity investors as the S&P 500 Index and the S&P TSX Index advanced by ~+5.0% and ~+4.8% for the month, respectively. Fixed income markets, however, did not share the same enthusiasm as bond yields advanced across the tenures with the short-end increasing faster than the long-end, pushing the yield curves deeper into inverted territory on both sides of the border. While the overarching fundamental story of the economy is still strong enough to continue to feed inflation and therefore a requirement of higher interest rates remained unchanged, the short-term technical factors were supportive of a bounce back in the markets. Historically, the fourth calendar quarter of the year has been typically the strongest (See Figure 1). Figure 1: S&P 500 Index, % price change March 2001 - September 2022 Favourable seasonality coinciding with washed-out investor sentiment provided the right backdrop for a market rally. The AAII’s (American Association of Individual Investors) US Investor Sentiment Bearish Readings index reflects bearish sentiment of individual investors and is considered a good contrarian indicator, i.e., extreme reflected pessimism generally indicates reversal in the markets. The index was near its historic highs at the start of the month (See Figure 2). Figure 2: AAII US Investor Sentiment Bearish Readings October 2005 - November 2022 During September (reported in October), the unemployment rate in Canada dropped from 5.40% to 5.20% and the unemployment rate in the US dropped to 3.5% from 3.7%. Inflation numbers at +6.9% in Canada and +8.2% in the US, were also ahead of expectations of +6.7% and +8.1%, respectively. Notwithstanding the still strong economic data indicating that conditions remain in place for inflation to stay high, investors’ optimism increased after the narrative gained momentum that Central Banks might be getting cautious of rising risks to financial stability. Early in the month, the Reserve Bank of Australia surprised investors by increasing policy rates by only 25 basis points as against the market expectations of 50 basis points. This coincided with the Bank of England’s intervention to support UK’s government bonds markets. The narrative received further boost after the Bank of Canada increased policy rates by only 50 basis points as against the market expectations of 75 basis points, citing it is trying to balance the risks of over-tightening and under-tightening. Given that markets have been fixated on policy rates trajectory year-to-date, the prospects of Central Banks nearing a pivot was supported by equity markets during the month. The FOMC (Federal Open Markets Committee) rate decision on November 2nd, however, reminded investors that it is usually Halloween that comes before Christmas. While the pivot did come as the US Fed chair, Jerome Powell, mentioned “it could be appropriate to slow the pace of increases as soon as the next meeting or the one after that”, investors were spooked as he also stated that peak policy rates might be higher than currently expected, i.e., hikes might continue to for longer even as the pace of hike slows. The markets gave up some of the gains of recent weeks on prospects of higher terminal policy rates than previously expected. In a nutshell, the fight against inflation is still on and it is not yet an all-clear that market volatility will abate soon.

By Cole Seabrook Financial Advisor, O’Farrell Wealth & Estate Planning | Assante Capital Management Ltd. Insurance Advisor, Assante Estate and Insurance Services Inc. It may seem too soon to start thinking about life insurance in your 20’s and 30’s, but you could benefit over the long term by obtaining coverage early on in your life. Both your age and health are determining factors when it comes to the overall cost for coverage. When you are younger and in better health, it is likely that you will pay less. You should definitely consider putting coverage in place on yourself at a young age. Before exploring the benefits of getting life insurance at a young age, it’s important to know the different types of life insurance coverage available. The two most common types of life insurance are Term and Permanent insurance. Term insurance provides temporary coverage at a lower cost with fixed monthly payments over the course of the term. At the end of the term there is the option to renew or convert to Permanent insurance. Permanent insurance provides individuals with guaranteed lifetime coverage with the opportunity to build cash value inside the policy. Typically, Permanent insurance has higher cost, but is an asset that grows over the course of time. Both Term and Permanent insurance benefits payout tax free in the event an individual passes away to a named beneficiary. Even a small amount of insurance could help pay for your funeral expenses and/or pay any debt the individual has including student loans, personal loans etc. Now that you have a better understanding of the most common types of life insurance, lets look at the benefits of getting coverage at a young age. The cost of your life insurance is based on your age, gender at birth, lifestyle, medical history, and current health. The longer you wait to obtain coverage the more you are going to be paying solely based on your age. If you experience health complications along the way this may increase the amount you will have to pay and, in extreme cases, you may be ineligible to qualify for coverage all together. In addition to lower cost while you are younger, insurance provides individuals with financial protection if the unexpected happens, and secures the insureds ability to get insurance if they develop any health conditions later in life. There are many life events that trigger individuals to think about life insurance such as, buying a home, marriage, becoming a parent etc. In the event an individual passes away, they wouldn’t want to leave their family with these debts or headaches. Insurance can take care of this. Everyone’s insurance needs are different and dependant on their financial situation, short-term, and long-term goals. Now that you have a better understanding of the importance of obtaining life insurance if you are young or single, what’s next? Speak with your Financial Advisor to determine; the type of coverage you need (Term or Permanent), how much coverage you need and to see how life insurance fits into your financial plan. If you would like to learn more about the benefits of getting life insurance, feel free to reach out and we would be more than happy to educate you further. Cole Seabrook is a Financial Advisor with Assante Capital Management Ltd. The opinions expressed are those of the author and not necessarily those of Assante Capital Management Ltd. Please contact him at 613.258.1997 or visit ofarrellwealth.com to discuss your circumstances prior to acting on the information above. Assante Capital Management Ltd. is a member of the Canadian Investor Protection Fund and the Investment Industry Regulatory Organization of Canada. Insurance products and services are provided through Assante Estate and Insurance Services Inc.