Written by Ron Cooke, President & Founder of Strategic Wealth Protection Partners in Ontario, CEA®, Member of the Estate Planning Council Canada
Mohammed and Sanjit* came to me at ages 76 and 75, looking for ways to reduce the impact of taxes and probate fees on their estate.
They owned a six-unit rental property worth approximately $4.5 million and had an additional $2.7 million invested in stocks and bonds. Their goal was to preserve as much of their wealth as possible for their family while keeping their planning straightforward.
Summary of Key Points
- Key Lesson: Reviewing multiple estate planning strategies before making a decision helps ensure the chosen solution reflects a family’s financial goals, complexity preferences, and long-term legacy objectives.
- Challenge: An Ontario couple wanted to preserve a six-unit rental property and other investments for their family while reducing future taxes and probate fees.
- Strategy: After evaluating several estate planning options, they chose a leveraged life insurance strategy that best matched their goals for simplicity and flexibility.
- Additional Planning: The strategy used the growing cash value of a permanent life insurance policy as collateral to borrow funds for reinvestment while creating tax-efficient estate liquidity.
- Outcome: The plan is expected to reduce the likelihood that their family will need to sell the rental property or other assets to pay future estate obligations.
The Problem
After guiding them through the first three steps of our Living Estate Plan process and reviewing their situation with tax professionals, we identified significant future tax and probate liabilities.
We explored strategies such as an estate freeze to defer future tax growth and reduce estate exposure. However, after reviewing the advantages and disadvantages, they decided they preferred a simpler approach.
This is why we offer our first 3 steps as a complementary service.
I feel people should know what options are available. They should also know what each option looks like before they spend any money to solve their problem.
The Solution
I helped them evaluate several alternatives and ultimately design a leveraged life insurance strategy that aligned with their objectives. (Leveraged life insurance is also called an Immediate Finance Agreementor IFA.)
The strategy included:
- An analysis of future estate tax and probate obligations
- Reviewing an estate freeze and other planning options
- Implementing a permanent life insurance policy
- Contributing approximately $100,000 annually for up to 12 years
- Using the policy’s growing cash value as collateral to borrow funds for reinvestment into their stock portfolio
This approach allowed them to maintain their investment strategy while creating a source of tax-free liquidity to help cover future estate taxes and probate fees.
As a result, their family will be less likely to face pressure to sell assets, including the rental property, to satisfy estate obligations. They were able to do this at no cost to them to get the answers they wanted and needed.
*Names and identifying details have been changed to protect the privacy of SWPP’s clients.
Optimize Your Wealth with the Right Life Insurance Strategy
Are you using life insurance as part of your wealth strategy, or just as basic coverage?
For many Ontario families, permanent life insurance can do far more than provide a payout. When structured properly, it can reduce taxes and help transfer wealth more efficiently to the next generation.
At Strategic Wealth Protection Partners, we help you go beyond surface-level advice.
Whether you’re exploring strategies such as insured retirement plans or leveraged life insurance, or simply want to understand how to structure your policy properly, our team will guide you step by step.
Schedule a Life Insurance Clarity Call
For high-income earners, business owners, and real estate investors, the biggest risk isn’t a lack of growth.
It’s taxation.
Without proper planning, a large portion of your estate will be lost to taxes, fees, and forced asset sales. Life insurance can help offset these costs and preserve more of your wealth for your family. But only if it’s used correctly.
But not every strategy is right for every situation.
That’s where SWPP comes in.
We design life insurance strategies as part of a complete estate plan, so every decision supports your long-term goals, not just a product recommendation. And if life insurance isn’t the right move, we’ll tell you.
We’ll show you all the wealth preservation options that apply to your exact situation, including living trusts, estate freezes, and life insurance.
Discover how to reduce and avoid taxes and leave a rock-solid legacy for the ones you love.
Read More
If you’re considering life insurance for estate planning, you may find these articles helpful:
- A Guide to Wills for Blended Families in Canada
- Pros and Cons of Putting a House in a Trust in Canada
- When You Inherit a House in Ontario, Is It Taxable?
About the Author
RON COOKE, PRESIDENT & FOUNDER OF STRATEGIC WEALTH PROTECTION PARTNERS
With over 30 years in financial services, I’ve seen the challenges families face when a loved one passes—lost assets, unnecessary taxes, and emotional stress. That’s why I created the Living Estate Plan, a comprehensive process to protect assets, eliminate estate and probate fees, and create legacies that are remembered for many years to come.
This plan ensures your family receives not just your wealth, but a meaningful reminder of your care and love. Tools like The Final Word Journal capture your story, wishes, and essential details, offering clarity and comfort during difficult times.
Your final gift should be more than money—it should be peace of mind, cherished memories, and an organized estate.
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