What Investment Strategy Is Right For You?

What To Invest Right Now

What to invest in right now

Are you interested in investing but don't know where to start? The key to investing over the long-term is to educate yourself on different investment products while getting crystal clear on what your objectives are. If you get in your car and don't know how to drive, you won't get very far. Of course, if you know how to drive but don't have a clear destination, you may not be very focused on the way, and distractions will indeed appear on the journey.

That's where insurance with uninterrupted compounding comes in. It's not an investment but a cash storage facility that enhances all future investments you plan to make. Best of all, unlike most insurance you may be familiar with, this type has living benefits and grows every year like clockwork.

Many Canadians tend to think of insurance as less of a long-term security account and more like a risk management device. This is often the case. Most families and businesses haven't been taught that you can access capital from high cash value life insurance to help augment your retirement and take advantage of opportunities. We have stories of Canadian clients paying off their mortgage, buying rental properties, stock-hacking, buying businesses or growing their businesses all using insurance assets.

Insurance Investment

what to invest in right now

Insurance as an investment vehicle? That seems pretty odd. There are many types of insurance, of course, but as an investment is a wrong lens to look through. Instead, high cash value insurance with Par Whole Life is more of a savings vehicle on steroids than an investment. Where the real power comes into effect is using the policy asset as collateral for the other spending and investment needs you have over a lifespan. This way, you get your actual investment and also get the constant stable growing increase of cash values from the policy. Plus, a nice tidy tax-free bow of the ever-increasing death benefit to make sure your family and business are protected all the way.

Insurance Investments Products

what to invest in right now

As you can see above, the current room available for 2022 follows the last two years at $6000. Many Canadians have far more space than this open. However, Canadians are seemingly getting more distrustful of governments in general and have concerns about the future of tax-qualified plans like the TFSA and RRSP. Much of this has to do with fears of the “bail-in” legislation in Canada. Following the Crisis of failing banks in Cyprus in 2012-2013 and Greece in 2009-2010 following the Financial Crisis, many western nations moved from bailout to bail-in legislation.

Famous bestselling Author R. Nelson Nash commented in his book Becoming Your Own Banker that tax-qualified plans provided by governments were akin to appointing the fox to guard the henhouse as he describes Willie Sutton's law. “Wherever wealth is accumulated, someone will try to steal it.” 

For this reason, Canadians are learning that the original “tax-free savings” has always been Participating Whole Life Insurance. It has been around as a stabilizing force in the financial lives of Canadian families for over 170 years. Unlike the restrictions of a TFSA account, there are no limits imposed on the government to how much you can put in or take out as a Par Owner with a private contract.


Insurance Investments Products

It is misleading to look at insurance as an investment. The most common forms of life insurance products in Canada that get lumped into this category are:

  • Participating Whole Life insurance. This is the type of insurance we strongly recommend for its 170 plus years history of consistent dividends. It has the highest guarantees, longest track record, most straightforward design, and best features that give the policy owner control. Participating whole life insurance is a permanent form of life insurance that guarantees lifetime coverage as long as it's in force. The dividends from this policy type can help create a powerful compounding effect over time. Its best feature is unrestricted access to capital with the contractural policy loan feature that can allow multitasking.
  • Universal Life Insurance. We do not recommend this type of life insurance. However, it is a style of insurance that allows you to pick and choose some basic investment options within it. This can work out well for someone who manages it well and has a high level of understanding…but most people aren't willing to put in the time to truly understand what's under the hood of this vehicle. It's often way too late when someone finds out they were missing a spark plug the whole time. You can learn more about that in our Universal Life article.


is life insurance a good investment

Is Life Insurance a Good Investment?

The short answer is “Yes.” However, there is “good” life insurance and “not-so-good” life insurance to consider. If you have a family to protect, bills to pay, and a big fat tax bill that will show up the day you die (most Canadians have one of these and just don't know it), then life insurance is critical. The issue is what type of insurance most Canadians have that won't be there the day they actually need it. A considerable portion of the population just gets basic term insurance or some kind of creditor protection. They rent the benefit for a period of time, like renting a house and end up with nothing to show for it. Contrast that to someone who buys a home or rental property and has both ownership and equity creation. This is what Par Whole Life designed well provides for Canadians.

The two main types of life insurance include participating whole life insurance and universal life insurance. Participating whole life insurance is a type of permanent life insurance, meaning that insured individuals will be covered for the entirety of their lives as long as premiums are paid regularly and on time.

Universal life insurance is a bit different, and we do not promote it. In fact, we strongly recommend avoiding this type of insurance. While universal life insurance has investment features, the added risks simply aren't worth it.

Universal life insurance provides a layer of coverage that a policy owner can invest in a side account into various mutual funds and segregated funds that are offered by the insurance company. Basically, it's term life insurance– just with a Vegas-style slot machine attached to it. By having a universal life insurance contract, you will be responsible for taking on all of the risks that would be avoided entirely by setting up a Participating life insurance policy.

Just as well, universal life insurance contracts around Canada and the USA have recently undergone a significant deal of scrutiny and lawsuits, in addition to policies lapsing later in life when such insurance policies are needed the most. On the other hand, participating whole life insurance will have a foundation of guarantees attached to the contract to make it an extremely stable asset. A universal life insurance policy will just put all of the risks and high-level management effort onto the policy owner.

invest in education

Invest In Education

Canadians need to up their game when it comes to their financial life. You do not need to defer all of your financial future to someone else. Instead, take on an active role in your economic life and learn more strategies to protect, secure and grow your wealth with confidence. There are many educational options. We have included many resource articles on our site for you to dig into and have fantastic content with case studies, demonstrations and client interviews available on our youtube channel and podcast.

Ready to learn even more about the power of life insurance you can use while you are alive? Check out the on-demand webinar training today to understand how you can increase your financial control and Become Your Own Banker.

Canadian Life insurance expert

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