Cottage Preservation Strategy

Cottage Preservation Strategy

• Client Profile
  • Client owns both a principle residence, and one or more recreation and/or revenue properties.
  • Properties have experienced dramatic gains in value over their initial purchase price(s) and/or depreciated values.
  • Client would like children to continue to own some or all of these properties.
  • Children may not be in a position to pay for the resulting tax liabilities and/or maintenance and upkeep costs associated with the properties, or may not be able to do so on an equitable basis amongst themselves.
• Solution Opportunity
  • Calculate and project total tax liability for all properties (other than designated principle residence).
  • Calculate and project maintenance and upkeep costs for all properties.
  • Purchase permanent life insurance that will cover this amount.
  • Depending upon individual situations of the insured and/or beneficiaries, children may pay some or all of the insurance costs to preserve these asset(s).