Joint Last-To-Die for Estate Planning

Taking out a joint life insurance policy is generally less expensive than two individual policies and offers some unique, strategic benefits. There are two options, identified according to the terms of the payout: joint first-to-die and joint last-to-die. Each has different uses, depending on your insurance needs.

A joint last-to-die policy is roughly half the cost of two individual policies. This offers considerable savings for budget-minded couples. You can provide for final expenses. Or leave a legacy for your children. It pays out only when both you and your spouse have passed away. The two deaths can happen simultaneously or years apart.

It pairs well with the Right of Survivorship laws that exist in many parts of Canada. This law specifies that, if a couple has a joint tenancy agreement, the surviving spouse assumes control of the estate’s property, without paying taxes or probate costs.

Confirm with your Carte Financial Advisor how these laws apply in your community. If the surviving spouse doesn’t need money to pay estate taxes, then holding a joint last-to-die policy can provide an economical way to leave a legacy for your children. Most couples name their children as beneficiaries to further reduce taxes.