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How An Insured Retirement Program Can Help You Achieve The Retirement Lifestyle You & Your Family Deserve

Protecting the financial well-being of your family can also help you achieve the retirement lifestyle you deserve.

Here’s the problem…

Most people think of permanent life insurance as money paid when someone dies. They know it’s a great solution for paying a tax liability at death, providing an estate for loved ones or leaving a gift to a charity.

But what about planning for retirement? Without careful planning, you may not have enough savings when you retire to maintain the standard of living that you’re enjoying now.

What are your options?

People typically think of RRSPs and other registered plans when they think of retirements. Many rely on these plans as their main source of retirement income. The problem is that the amount you can contribute to registered plans is limited. This means the base amount might not be large enough to provide the retirement income you desire.

One solution is Manulife’s Insured Retirement Program. It uses a permanent life insurance policy to provide you with the insurance protection you need Plus a unique additional feature… access to tax-free cash during your retirement years.

How does it work?

Under current tax law, the cash value in a life insurance policy accumulates tax-free, up to certain limits. The Insured Retirement Program lets you use that cash value at a point in the future. Whether you want to supplement retirement income, purchase a vacation property or go on a trip, the Insured Retirement Program lets you use your policy’s cash value as collateral for a bank loan.

This bank loan provides the cash you desire, and you receive it tax-free. The loan doesn’t have to be repaid until the life insured dies. When the insured dies, the tax-free death benefits are used to repay the loan. Once the loan is repaid, any remaining death benefits are then paid to the policy’s beneficiary.

Are you a candidate?

Estate and retirement planning is critical to your financial health and it requires your careful consideration. The Insured Retirement Program generally is designed for those who:

  • Need permanent life insurance protection
  • Are between the ages 30 and 55
  • Are in a high marginal tax bracket
  • Have a maximized RRSP/pension plan contribution
  • Want to supplement retirement income with tax-free dollars
  • Want to reduce the amount of tax they’re currently paying on investments
  • Have minimized non-deductible debt

An excellent solution to consider

Life insurance offers a very effective retirement planning tool. Manulife’s PAR policy, combined with the Insured Retirement Program, provides you with permanent protection today and tax-free cash during your retirement years.

Here’s an example of how Manulife PAR and the Insured Retirement Program combine to provide an effective retirement planning solution. The example is based on the following assumptions:

Coverage Type
Joint last-to-die, premiums to last death
Clients Male 48, non-smoker and female 47 non-smoker
Initial face amount os insurance policy $750,000
Planned deposits 10 years
Personal tax rate 50%
IRP Loans begin Year 23
Life expectancy Year 43
Bank loan rate 5%

Manulife PAR and the Insured Retirement Program

Manulife PAR
Taxable investment
Annual deposit $30,000 $30,000
Dividend scale/rate of return Current less 1% 5%
Annual tax-free pay-out $31,160 $31,160
Death benefit at year 43 $1,652,525 $0
Loan balance at year 43 $1,168,662 $0
Net estate value at year 43 $483,863 $0

Manulife PAR-better together!

  • A life insurance solution that, in addition to long-term protections and valuable guarantees, combines with the Insured Retirement Program to offer tax-free access to cash in your retirement years.
  • You receive an annual statement showing the growth of your policy values in the past year.
  • Pre-approved lifetime deposit option limit gives you flexibility to decide the amount and number of additional deposits you make into your policy to suit your needs and cash flows.
  • Your solution is backed by the strength of Manulife, one of the largest life insurance companies in Canada.

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