The Legacy Plan
THE LEGACY PLAN
What You Leave Behind, Delivered As You Intended
A framework for transferring wealth efficiently, with attention to taxation, beneficiary structure, and the preservation of what you have built.
- Rutrum mollit et ab laborum.
- Mollit quisque aute voluptat.
- Mollit quisque aute voluptat.
The Problem
Estate planning in Canada is governed by a small number of principles that almost every family eventually runs into and very few plan for in advance. There is no estate tax as such, but there is a deemed disposition at death that triggers capital gains tax on appreciated assets and full taxation of registered accounts at the deceased's marginal rate. Probate fees apply on assets that pass through the estate, varying by province. Family dynamics produce disputes that wills resolve imperfectly. Cross-border holdings, second marriages, business ownership, and dependent adult children all introduce complications that boilerplate estate documents do not handle.
The result, for most Canadian families, is an estate that loses a meaningful percentage of its value to tax and process before any of it reaches the people it was meant for. The loss is largely preventable. The prevention requires planning that most families defer until it is too late to do well.
The Approach
The Legacy Plan begins with a structured conversation about what you want your estate to accomplish. Who do you want to inherit, in what proportions, on what terms. Are there children from different relationships, or dependents with special needs, or charitable intentions that should be reflected. Are there illiquid assets such as a business, a primary residence with substantial appreciation, or investment property that will require structural handling. Are there cross-border considerations, US-citizen children, property held in another country.
Only after this conversation does the Plan move to instruments. Each instrument exists to address a specific estate planning challenge, and the right combination is specific to the family. We work in coordination with your estate lawyer and your accountant, recognising that the Legacy Plan is one part of an integrated estate strategy, not the whole of it.
The Instrument
Permanent life insurance is the central instrument in most Legacy Plans, used not as a death benefit product but as a tax-efficient wealth transfer mechanism. The death benefit on a properly structured permanent policy passes to beneficiaries outside the estate, tax-free, in a single liquid payment. This provides immediate liquidity to pay the deemed disposition tax on appreciated assets without forcing the sale of those assets at unfavourable timing. It allows a business or an investment property to be transferred to the intended beneficiary without the estate being broken up to pay the tax bill. It allows the family cottage to remain in the family.
Segregated funds with named beneficiaries serve as a complementary instrument. Unlike mutual funds held in non-registered accounts, segregated funds with named beneficiaries pass directly to the beneficiary outside the estate, bypassing probate, simplifying administration, and providing the same creditor protection most families want for transferred wealth.
Insured annuities, for retirees who want guaranteed lifetime income alongside an intact legacy for beneficiaries, combine the certainty of an annuity with a permanent life insurance policy that replaces the annuitised capital at death. This is a specific structural solution that suits some retirees and not others.
Trust structures, where appropriate, handle situations that cannot be solved through beneficiary designation alone. These include funding for dependent children with disabilities, staggered distributions to adult beneficiaries, and the preservation of wealth across multiple generations. Trust planning is conducted in coordination with your estate lawyer.
The Cascade
For families thinking across multiple generations, the Legacy Plan can extend into what is sometimes called a cascade strategy: permanent life insurance policies structured to transfer ownership and benefit across generations, so that the wealth-building function of the policy continues across the grandchildren's lifetime rather than ending at the original policyholder's death. This is a specialised application of the Legacy Plan and suits a specific kind of family. We will tell you honestly whether it is appropriate for your situation.
The Coordination
The Legacy Plan does not replace your estate lawyer's work. It complements it. A complete estate plan typically includes an up-to-date will, powers of attorney for property and personal care, beneficiary designations on all registered accounts and insurance policies, and where appropriate, trust documentation. Aevum coordinates with your existing legal and accounting advisors. Where you do not currently have an estate lawyer, we can refer you to one. We do not draft legal documents.
"An estate is not the sum of what you own. It is what arrives where you intended, intact."
The Next Step
A first conversation about the Legacy Plan covers your current estate position, your family circumstances, your intended beneficiaries and proportions, and the specific concerns that have prompted you to think about estate planning now. It is a complimentary thirty-minute meeting, virtual or in person.
Facing Any Problem To Get A Quote!
CONTACT US ANYTIME
Call : 1.888.255.4364
