Simple estate planning

At a difficult time, it's important to keep things simple

Why do people do estate planning? There are lots of reasons: maximize the value; minimize the taxes; include or exclude a specific person; support a charity…

There are many complex and expensive ways to achieve these and other objectives. But for most people, objectives are simple, and so should be the solutions.

My estate planning goals, for example, can be easily summarized: to be fair — so that hopefully when all is said and done, my children will still speak to each other; and to do what I can to ensure that whatever is left is put to good use, and has some lasting benefit.

When working on an estate plan recently I came across a little-known strategy that can be executed through an insurance company.

It starts with investments available from insurance companies. This could include vehicles such as annuities, insurance policies, segregated funds, and GICs. In many ways these investment products are similar to their non-insurance counterparts: GIC rates, for example, are competitive with bank GICs, and are covered by insurance up to $100,000. Segregated funds as well, like mutual funds, come in a variety of shapes and forms. But there are some key advantages to both of these.

To begin with, there is the ability to name beneficiaries. Rather than the proceeds of these investments going through the estate, you can elect to have the funds pass directly to those who you name as your beneficiaries — without delay. Right out of the gate there is a savings that could easily exceed two per cent, when you consider the probate fees as well as the legal fees typically associated with settling an estate.

But there is more. Some insurance companies will also allow you to stipulate in their contract how the beneficiaries will receive the funds. For example, an annuity might be an option. So rather than receiving a lump sum (that some parents fear might be squandered), the beneficiary would instead receive a monthly income for a specified period of time, or for life. The amount of income can be fixed, or can be indexed. Or, in the case of at least one company, the level of income can be tied to the performance of the stock and/or bond market.

As far as I know, the only other way to ensure such an outcome would be through a trust — a document that is complex and expensive to set up and maintain. Instead, by completing a simple form through an insurance company, your wishes could be met, and it wouldn’t cost you anything.

For more information please feel free to call or e-mail.



Jim Grant, CFP (Certified Financial Planner) is a Financial Advisor with Raymond James Ltd (RJL). This article is for information only.  Securities are offered through Raymond James Ltd., member CIPF.Insurance and estate planning offered through Raymond James Financial Planning Ltd., not member CIPF.  For more information feel free to call Jim at 250-594-1100, or e-mail and/or visit


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