How to Have Your Cake and Eat It Too
There is an old folk proverb that says, “You can’t one of them is still alive, make a generous donation to
have your cake and eat it too.” It turns out that their favorite charity, and still have all of their money left-
this is not always the case. over when they die to divide among their five children.
They have $500,000 available.
Take, for example, the way an annuity and a life insurance
policy can work together to give you three benefits for the They put $352,000 into a single premium immediate an-
price of one. You can 1) obtain a reliable income stream nuity (SPIA) based on Bill’s life which creates a private
(with a portion of it being tax-free); 2) make a generous pension stream. The pension is used to pay for a
tax-deductible donation to your favorite charity or chari- $500,000 life insurance policy on Bill and provides Bill
ties; and 3) have ALL of your original money left over for and Betty with $25,000 a year (some of it tax-free) to
your beneficiaries when you die. Yes, you heard me cor- supplement their income. They take the remaining
rectly. You can use the money now and have the same $148,000 and make a generous contribution to their fa-
amount left over to pass along to your heirs when you die. vorite charity. (They are allowed to carry forward the tax
deduction for five years after the year of the donation.)
Here’s an example of how it works. (Note: Exact results
They continue to receive $25,000 every year as long as
will vary depending on the individual and the arbitrage
Bill lives. After Bill dies, his life insurance policy pays
of the annuity pension and the insurance premium.)
their estate $500,000.
Let’s say Bill and Betty (both age 73) would like to create
a tax-friendly revenue stream for themselves as long as
BUT WAIT, THERE’S MORE!
Toll Free: 866-561-3754
Cash Flow Illustration
* Life Insurance Policy Secures A $500,000
Guaranteed Death Benefit Which Returns
Initial Amount To The Estate.
If you would like more information, please contact
Ron Doerksen - Sustainable Finances
At that point we can discuss the details of your situation.
This brochure provides general information that highlights the use of certain insurance products. It is not intended to give legal
or tax advice. You are encouraged to consult your attorney or your CPA.