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Tag: Whole Life

  • Tatiana Schlossberg, granddaughter of JFK, reveals terminal cancer diagnosis

    Tatiana Schlossberg, granddaughter of slain President John F. Kennedy, is battling a rare form of leukemia and may have less than a year to live.

    In an essay published Saturday in the New Yorker, the 35-year-old environmental journalist wrote her illness was discovered in May 2024 after she gave birth to her daughter. She was diagnosed with acute myeloid leukemia with a rare mutation known as Inversion 3 and has undergone several treatments, including chemotherapy and bone marrow transplants.

    Schlossberg is a daughter of former U.S. Ambassador Caroline Kennedy, the former president’s daughter, and Edwin Schlossberg. They live in New York.

    In her essay, Schlossberg acknowledged that her terminal illness adds to a string of tragedies that has befallen the famous political family. Her grandfather was assassinated in Dallas in 1963. Nearly five years later, his brother, Sen. Robert F. Kennedy, was fatally shot in Los Angeles after giving a victory speech at the Ambassador Hotel following his California presidential primary win. Her uncle, John F. Kennedy Jr., died in 1999 when his small plane crashed.

    “For my whole life, I have tried to be good, to be a good student and a good sister and a good daughter, and to protect my mother and never make her upset or angry,” Schlossberg wrote.

    “Now I have added a new tragedy to her life, to our family’s life, and there’s nothing I can do to stop it.”

    She wrote her diagnosis was stunning. She had just turned 34, didn’t feel sick and was physically active, including swimming a mile one day before she gave birth to her second child at Columbia-Presbyterian hospital in New York.

    After the delivery, her doctor became alarmed by her high white blood cell count.

    At first, medical professionals figured the test result might be tied to her pregnancy. However, doctors soon concluded she had myeloid leukemia, a condition mostly observed in older patients. She ended up spending weeks in the hospital.

    “Every doctor I saw asked me if I had spent a lot of time at Ground Zero, given how common blood cancers are among first responders,” Schlossberg wrote. “I was in New York on 9/11, in the sixth grade, but I didn’t visit the site until years later.”

    She has endured various treatments. Her older sister, Rose, was one of her bone marrow donors.

    In the article, Schlossberg mentioned the Kennedy family’s dilemma over controversial positions taken by Robert F. Kennedy Jr., her mother’s cousin. Schlossberg wrote that while she was in the hospital in mid-2024, Kennedy suspended his long-shot campaign for president to throw his weight behind then-Republican candidate Donald Trump.

    Trump went on to name Kennedy to his Cabinet as secretary of the Department of Health and Human Services, which oversees the Food and Drug Administration, National Institutes of Health and the Centers for Disease Control and Prevention.

    In one of his early moves, Trump demanded a cut in government money to Columbia University, which employs her husband, George Moran.

    “Doctors and scientists at Columbia, including George, didn’t know if they would be able to continue their research, or even have jobs,” she wrote. “Suddenly, the health-care system on which I relied felt strained, shaky.”

    On Saturday, her brother Jack Schlossberg, who recently announced his bid for Congress in a New York district, shared on Instagram a link to her New Yorker essay, “A Battle with My Blood.”

    He added: “Life is short — let it rip.”

    Meg James

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  • Term vs. permanent life insurance: How to choose what’s right for you – MoneySense

    Your insurance choice depends on your long-term financial goals

    Brooke Dean, founder of BMD Financial Ltd. at Raymond James, likens the two options to renting versus owning. “Term life insurance is like renting an apartment,” she said. Similar to renting, people pay for coverage for a set period of time. When the time is up—similar to a lease ending—the consumer walks away without any ownership or equity in the policy. 

    Permanent life insurance is like buying a house, Dean said. This type of policy has a higher upfront premium, but with time, the policy can accumulate equity, and people can borrow against it, similar to a home.

    Each serves a different purpose in financial planning, and deciding which one would be more suitable depends on individual needs.

    Jeffrey Talor, director of sales at CanWise Life Insurance Services, says a permanent life insurance policy could be one of the cleanest ways to transfer wealth. For example, when adult children inherit their parents’ assets—such as a home, cottage or business—the assets will be assessed at fair market value and any capital gains would be subject to taxes. A permanent policy could provide the cash to settle tax bills without the need to sell any of those assets. “If you don’t have the cash flow, this is one of the items of strategy that we’re noticing is a great way to mitigate taxes,” Talor said.

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    When permanent life insurance makes sense—and when it doesn’t

    A permanent policy can also offer dividends. Dean said a portion of the premiums are typically invested on behalf of the policyholder with a goal to maximize dividends. But it may not work as an investment strategy for everyone—especially younger people.

    Dean said her clients under the age of 50 often ask about permanent life insurance and how they heard it could be an investment strategy. “If you’re looking at it as just an investment strategy and you don’t have a lot of investments already saved up, then no, that’s probably not the best way to do it,”  she said. Instead, she recommends using it as an investment only after you have topped up your registered savings accounts and might be looking at other ways to put disposable cash to use.

    Talor said some people also buy permanent policies to leave a legacy. For example, Talor said he has seen grandparents buy permanent policies as gifts to their grandchildren—establishing a nest egg for them to leverage or borrow against when the grandkids enter adulthood. He said the younger the policyholder is, the more time the policy gets to accumulate its cash value.

    Term insurance has the appeal of being more affordable and accessible—offering large-enough coverage for a set period of time for young families who may have a mortgage and kids. Talor said term life insurance can be 10 to 15 times cheaper than a permanent policy. “The average Canadian cannot afford to buy the amount of permanent insurance they need,” he added.

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    When it makes sense to combine policies

    Talor said he often sees his clients go for a blend of both term and permanent life insurance policies, which protect them in the short run but also builds equity in the long term. 

    Dean said there are some insurance companies that allow rolling or converting a term life insurance policy into permanent life insurance, without having to lose the premiums that were already paid into it earlier. But she said it’s important for people to ask why they need both at the same time.

    “Is there still a mortgage outstanding? If you were to pass away, do you still have kids you have to provide for?” she asked. “But you also are making a good income and say your RRSPs and TFSAs are topped up.” “You want that term because it’s cheap, you have the coverage, but you also want to start investing in this other product and diversifying a bit more.”

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  • Should seniors cancel their life insurance policies? – MoneySense

    Should seniors cancel their life insurance policies? – MoneySense

    It’s got to be your decision. To help you decide, I will give a quick review of why purchasing insurance makes sense and the two types of insurance available. You can then relate the reason for purchasing insurance to your current need for insurance. 

    Why do Canadians need life insurance

    Ultimately, Canadians buy life insurance because they want to take care of others should something happen to them. They want to protect their survivor’s lifestyle or maximize the inheritance with insurance when they pass away unexpectedly, or naturally after a long, healthy and happy life.

    There are two financial needs to consider when determining the amount of insurance needed: How much income would be needed, as well as current and future debts. Current debt may be a mortgage, and future debt may be children’s university expenses or future taxes.

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    How much life insurance would you need?

    A simple method in determining the how much insurance you need to replace your income is to divide the income needed by a safe investment return.

    If you need to replace an annual income of $50,000, and you think you can safely earn 5% on the invested insurance proceeds a year, then divide $50,000 by 5%. This gives you a need for $1 million of insurance, or $1 million minus your existing investments. That is earning 5% a year on a $1 million gives $50,000 a year.  

    You could argue that you don’t need the $50,000 annual income replacement for life because, your expenses will be lower as you age, you will have other income such as the Canadian Pension Plan (CPP), Old Age Security (OAS), and so on. That’s all true— but this calculation does not take into consideration inflation. Over time inflation will whittle down the value of that $1 million.

    Does life insurance cover debt?

    Yes, and once you know how much insurance you need to replace income, then just add on the debt.

    Maybe when you purchased the insurance your situation looked a bit like this: A $750,000 mortgage and anticipated post-secondary expenses of $250,000 for children, if any, means upping the insurance from $1 million to $2 million.

    Allan Norman, MSc, CFP, CIM

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  • Infinite banking in Canada: Should you borrow from your life insurance policy? – MoneySense

    Infinite banking in Canada: Should you borrow from your life insurance policy? – MoneySense

    Now, after a fair bit of research and a few interviews with experts on infinite banking, I feel I know enough to pass on the basics—plus what you should think about before signing up. 

    What is infinite banking?

    According to a useful primer from independent insurance firm PolicyAdvisor, “Infinite banking is a concept that suggests you can use your whole life insurance policy to ‘be your own bank.’” It was created in the 1980s by American economist R. Nelson Nash, who introduced the idea in his book Becoming Your Own Banker. He launched the “Infinite Banking Concept” (IBC) in the U.S. in 2000, and eventually it migrated to Canada.

    An article on infinite banking that appeared both on Money.ca and in the Financial Post early in 2022 bore a simplistic headline that said, in part, “how to keep your money and spend it too.” The writer—Clayton Jarvis, then a MoneyWise mortgage reporter—framed the concept by declaring that the problem with the average Canadian’s capital is that it’s usually doing just one job at a time: it’s spent, lent or invested. 

    “But what if you were able to put your money to a specific purpose and continue using it to generate income? That’s the idea behind infinite banking (IB),” Jarvis wrote. He compared IB to a reverse mortgage: “In both cases, you still possess the appreciating asset being borrowed against—your policy or your home—and you have the freedom to pay back the loan at your leisure[.]” But Jarvis also evinced some skepticism when he added: “those who have sipped rather than chugged the IB Kool-Aid say it’s a strategy that may be too complex to be marketed on a mass scale.”

    Borrowing from your life insurance policy

    If you’re not familiar with the finer details of insurance, infinite banking does seem a bit arcane. Rather than put your money in a traditional bank—which until the last year or so paid next to nothing in interest on accounts—you would invest in a whole life or universal life insurance product, both of which provide some “cash value” from the investment portion of their policies. Then, if you want to borrow money, instead of making hefty interest payments to a bank, you would borrow against your life insurance policy. 

    As PolicyAdvisor explains, “Because you’re only borrowing from your policy, the insurance company is still investing your entire cash value component. So, your cash value still grows even though you’ve borrowed a portion of it.” 

    Those new to infinite banking should watch a YouTube primer made by Philip Setter, CEO of Calgary-based insurance broker Affinity Life. In it, he readily concedes that much of the marketing hype portrays infinite banking as some kind of “massive secret of the wealthy,” which essentially amounts to buying a whole life insurance policy and borrowing against it. Setter has sold many leveraged insurance products himself, but to his credit, in the video he calls out some of the conspiracy-mongering that seems to be attached to infinite banking, including the primary message from some promoters that traditional banks and governments are out to rip off the average consumer. 

    Infinite banking seems to be geared to wealthy people who are prepared to commit to the long term with the leveraged strategy, and who can also benefit from the resulting tax breaks (more on this below). It’s not for the average person who is squeamish about leverage (borrowing to invest) and/or is not prepared to wait for years or decades for the strategy to bear fruit. As Setter warns in his video: “Once you commit to this, there’s no going back.” If you collapse a policy too soon, it’s 100% taxable: “It only is tax-free if you wait until you die … you commit to it until the very end.” 

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    How are insurance advisors paid for selling infinite banking products?

    Asked how advisors are paid, Setter said they receive a lump-sum commission based on the premium amount of the policy. I also asked this of Asher Tward, financial head of estate planning at TriDelta Private Wealth. In an email, Tward said it’s “the same as with any insurance policy—mostly upfront commission based on premiums paid (higher if there is more initial funding). Fundamentally, this is a life insurance sale. If one undertakes an external or collateralized loan versus a policy loan, they may be compensated on the loan as well.”

    Jonathan Chevreau

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