A tale of two families

The Independent

By John Ardill

I have a confession to make: I can’t delete people from my phone contacts, even if they’ve passed away. It feels like losing them all over again. But those names also serve as a powerful reminder – a reminder to make sure my own affairs are in order. And a big part of that is life insurance. Let me tell you about two families I knew, and how life insurance played a very different role in each of their stories.

The Prepared Family

In the first family, the father tragically passed away in an accident, leaving behind a capable spouse and two children. Thankfully, they had laid a solid financial foundation, with a key component being a whole life insurance policy. This wasn’t just any policy but one specifically tailored to their needs.

When the father passed, the life insurance provided a tax-free cash injection into the estate. This gave the surviving family time and flexibility. They could take their time selling the family business at a higher price instead of being forced to sell in a panic. Their lifestyle wasn’t disrupted, and their financial challenges were minimal. They could focus on grieving without the added burden of financial stress. The life insurance gave them options and power—two things every family needs during tough times.

The Unprepared Family

Contrast this with another family I know.  They chose not to engage with life insurance as a financial tool. When the husband – a friend of mine – passed away, the estate faced significant challenges. While there were assets, liquidity was an issue. Freeing up cash took time, and decisions were made under emotional stress. The result? A shrinking estate, compounded by legal and accounting complications, along with pressure from the CRA.

This scenario was completely avoidable with proper planning. Why put your loved ones through unnecessary hardship when a life insurance policy could provide the cushion they need?

Why Life Insurance?

Life insurance isn’t always a popular topic. Opinions range from “it’s a rip-off” to “it’s the most valuable estate planning tool.” The truth? It can be complex, but it’s one of the most important decisions you’ll make. With over 50 design options available, each policy should be customized to fit your unique situation. A skilled advisor can help create a plan that offers flexibility and security for the rest of your life.

Most national accounting firms endorse life insurance as an important planning tool. This widespread support highlights its value in building and preserving wealth across generations.

Here’s a quick comparison to highlight the benefits of a whole life policy versus simply investing the money:

FEATURE INVESTING WHOLE LIFE INSURANCE
Growth Up and down, market-dependent Consistently grows, never loses value
Taxation Taxed on growth Tax-deferred cash growth; tax-free death benefit
Leveraging Limited Borrow up to 90% of cash value

The Bigger Picture

As we age, many of us feel like we’re fighting an uphill battle against taxes and fees. It’s true: without careful planning, our wealth can be chipped away, leaving less for future generations. But there’s a solution. Wealthy families like the Rothschilds have long used life insurance to secure their legacy. By purchasing large policies on family members, they ensure wealth continues to grow and support their descendants.

Life insurance is a beautiful thing when used wisely. It provides security, flexibility, and peace of mind—not just for you, but for your loved ones. If you haven’t already explored its potential, now is the time.

Thanks for reading.  I’d love to hear your thoughts or answer any questions you might have.

Sincerely,

John Ardill
Founder and Mentor
Ardill Group

Direct: 1 416 400 5882
Office: 1 905 907 7000
john@ardillgroup.com

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