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What
Will Your Legacy Be?
The
word ‘legacy’ likely invokes images of a wealthy
individual leaving large sums of money to their family or
favourite charity. Yet
for those of us who are Christians, we each are leaving a
legacy or much greater worth.
In
the simplest terms, a ‘legacy’ is “whatever we pass on
to those who follow us”.
It often will involve spiritual, family heritage,
cultural, social, political as well as material blessings.
Just think, the greatest legacy ever left to us, was
left by our Lord during His time on earth.
Yet none
of his legacy involved financial or material items.
The
patriarchs of the Old Testament spent a significant amount of
time ensuring that they passed on their legacy especially
their spiritual and family heritage.
They understood the value for their family of taking
the time to pass on their memories, experiences, trials etc.
that had molded their lives.
We need to take the same time to think about those
special memories that you should share with your family; your
early childhood, your wedding, your salvation experience, your
work life. Be
encouraged to write it down.
With
our many material blessings, a part of the legacy will be
financial in nature. Sadly,
however upwards of fifty percent (50%) of our estate could be
left to CCRA (Revenue Canada).
Please consider these items:
Your will.
Without it being current, there is an opportunity that
your wishes and desires will not be carried through.
Find a lawyer who is an estate specialist to help you
ensure that your wishes and plans have been written down.
Finances.
There is a huge advantage to working with a Financial
Planner who shares your same faith as he/she will understand
your spiritual perspectives. As part of this, make sure that you have complete listing of
all of your financial records.
This is an essential part of your legacy.
Eternal significance!
Build into your financial legacy a portion that will
see the Lord’s work expand.
Dream of the ministries, the capital expansion or other
mission initiatives that your financial legacy would fund or
support. As an
added benefit, these legacies can often provide significant
tax advantages. Let
me give you an example.
You
have a cottage that you plan on passing to your children,
however it will likely produce a significant tax liability on
your death. CCRA
considers you to have sold your assets just before your death.
It is often the case that a cottage could create a
$200,000 capital gain. This
means $100,000 in taxes.
Why not leave an insurance policy worth $200,000 to
your church or favourite ministry.
This will create a $100,000 tax credit.
The cottage then passes on tax free to the children.
Each
of us will leave a legacy.
Are you being a good steward with your legacy?
You
asked?
| Question: |
My
mutual funds over the last several months have dropped
in value and do not seem to be making money.
Should I consider converting them to a less
volatile type of investment? |
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| Michael
Nichols: |
With
the way the markets and the news media have reacted
recently, it can become very easy to be discouraged
about your investments. Since 1969 the TSE 300 has had
seven years where returns have been negative. Yet the average one year return after these market downturns
was 19.1% and the two year return has been 14.7%.
While
the past is not indicative of the future, an historical
review can put stock market downturns in context. And
making the right decisions in a down market may allow
you to profit even more when the market makes it’s
next gain(s).
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Consider
This…
If
you are thinking about opening an RESP for your children
consider making the lower income spouse the subscriber (the
owner of the plan). This way if you child chooses not to go to
post secondary school the lower income spouse will pay less
tax when the money from the RESP has to be withdrawn.
A
Second thought…
‘Would
you tell me, please, which way I ought to go from here?’
‘That
depends a good deal on where you want to get to,’ said the
Cat.
‘I
don’t much care where --’
said Alice.
‘Then
it doesn’t matter which way you go,’ said the Cat.
Lewis
Carroll
Alice’s
Adventures in Wonderland
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