E36: Insurance 201 with Sterling Park

As a follow-up to Episode 33: Insurance 101 with Simon Kay, this episode features Zak Goldman and Jonah Mayles from Sterling Park providing an "Insurance 201" lesson for our listeners, with a focus on the tax and wealth creation advantages of whole life insurance. Whole life insurance is a permanent insurance policy that grows in value over time by participating in distributions from the insurance company’s pool of investments. This type of policy offers a significant opportunity to boost wealth and estate value, for two key reasons: The policy's value grows tax-free and is typically distributed tax-free[i] upon death, and When held within a corporation, the proceeds can be paid to your estate on a tax-free basis[ii] without being subject to additional taxes like most other corporate assets. For someone with a corporation, the additional after-tax value of dollars invested in a whole life insurance policy can be potentially double what could be achieved without the use of insurance.[iii] Brian and the "Dynamic Duo" of Zak and Jonah explain whole life insurance and how it works, compare the after-tax result of using insurance vs. not, and provide insight into how to know if an insurance policy is right for you. Zak is a founding partner of Sterling Park. He has advised affluent clients and business owners for over 20 years. He holds the Family Enterprise Advisor™ (FEA) designation and an MBA from the Rotman School of Business at the University of Toronto. Jonah is a partner at Sterling Park and is the tax, legal and estate planning guru in the firm. Before joining Sterling Park, Jonah was a tax lawyer at Fraser Milner Casgrain and Torkin Manes where his practice focused on business succession planning, estate planning, advising on and drafting family trusts and structuring/implementing tax-efficient sales and purchases of businesses. If you like what you hear, please don’t hesitate to rate us kindly. And if there are particular topics you’d like covered, please let us know. This episode is brought to you by Ginsler Wealth Financial Services Inc., a FSRAO licensed insurance agent corporation. Nothing in this podcast should be deemed to be insurance or financial advice, and is for informational purposes only. [i] The tax-free nature of whole life insurance may not be absolute under certain circumstances, including in shorter duration insurance policies. This letter is meant only to provide a high-level overview of the benefits of whole life insurance and is not comprehensive. Please speak with Ginsler Wealth Financial Services Inc., a FSRA licensed insurance agency, or your own insurance advisors for more specific details. [ii] Ibid. [iii] The precise outcome of utilizing these types of insurance policies will depend on the age, gender and medical profile of the insured(s) at time of entering into the policy and the age of death of the unsured(s) amongst other factors. Talk to Ginsler Wealth Financial Services Inc. or you own insurance advisor for more precise details. Timestamps 0:00 Disclaimer & Intro 5:00 How Zak & Jonah entered the insurance industry 10:42 Term insurance vs. whole life 12:40 Whole life insurance & how it works 22:16 Using insurance to transfer wealth 41:55 Tips for prospective insurance buyers 44:48 Simplifying insurance buying 51:31 If Zak & Jonah could do anything, what would it be? 53:18 Outro & Disclaimer