Stage 2: Consideration – “What If the Bank of Mom & Dad Was Smarter?”

As a parent or grandparent, you’ve probably been asked for help; a down payment, a loan, a little extra for school or a wedding. These are acts of love, and for decades, Boomers like you have stepped up. In fact, economists now refer to this trend as the “Bank of Mom and Dad.” According to a 2023 CIBC study, nearly 30% of first-time homebuyers in Canada received direct financial support from family with the average gift exceeding $82,000.

But as the cost of living rises and financial pressures on younger generations increase, many Boomers are starting to ask: What happens when I’m gone? Will the gift I leave behind actually help, or could it backfire?

This is the perfect time to consider how you leave your wealth; not just how much.

Let’s imagine two scenarios.

In the first, you leave your loved onesa lump-sum inheritance. It could be one hundred thousand or five hundred thousand; even more. That money is typically passed through your estate, delayed by probate, subject to legal fees, taxes and other costs; often emotionally overwhelming for your beneficiaries, especially if they’re grieving.

In the second, you use strategic legacy planning by SaferWealth. That same inheritance can be delivered tax-free privately,  and most importantly; structured to support your family over time.

This is not wishful thinking. It’s exactly how many financially savvy families and high-net-worth individuals preserve generational wealth.

With Investment insurance, life annuities, and infinite banking strategies, you gain control over not only what you pass on, but how and when it’s received. These are not products designed to take money from your family; they’re built to ensure your money outlives you, and then serves your family without being squandered.

Let’s break it down:

Investment Insurance

This isn’t the insurance you may have bought in your 30s. investment  policies build guaranteed cash value, like building equity in a house and is paid out tax free, like a house; tax-deferred growth, and a tax-free death benefit. You can even use it while you're alive  for emergencies, retirement, or gifts. Upon death, the payout can be structured through a trust or settlement option to be released in stages, or tied to age or education goals.

Life Annuities

These are ideal if you want to convert part of your estate into guaranteed income for yourself now or for loved ones later. An annuity can provide your child with, say,  $10,000/month for 20 years instead of a lump sum they might spend in 6 months. It removes the temptation to overspend and protects your gift from predators, lawsuits, and even divorce.

Infinite Banking

This concept allows you to become your own bank. Using a specially designed life insurance policy, you can borrow against your own money, pay yourself back with interest, and keep the wealth circulating within your family. It teaches financial discipline and stewardship things no cheque ever will.

Here’s why this matters more than ever:

• Today’s young adults are under intense financial strain.With student loans averaging over $28,000, stagnant wages, and housing often out of reach, a sudden inheritance can become a pressure release valve; not a growth tool. It’s used to "catch up to Jones," not sacrifice and get ahead.

• Inheritances are rarely discussed. A 2022 RBC poll found that only 33% of Canadians had a conversation about wealth transfer with their loved ones. Without guidance, most kids simply don’t know how to manage large sums and, don’t know where to ask for help and  won’t ask for help until it’s too late.

• Probate and estate taxes reduce what you leave. In Ontario, for example, estate administration tax is 1.5% of anything over $50,000. That’s $15,000 lost on a $1M estate. Add court delays and lawyer fees, and you can lose 5–10% or more. Life insurance bypasses this completely. Just on this issue alone, it makes no sense to have any assets outside of the protection of the insurance industry.

This isn’t about mistrusting your children. It’s about protecting them from a system and sometimes from themselves. Life is hard enough for the next generation. The legacy you leave should be an anchor, not a storm.

The "Bank of Mom and Dad" isn’t going away. But it can get smarter and more strategic. With the right plan, you can pass on stability instead of stress, opportunity instead of obligation, and wisdom instead of worry.   Now is the time to design a legacy that works. Because a true gift is one that lasts and helps them grow.

So before you set aside a sum for your loved ones, ask:

• Will my legacy be used wisely?

• What is the right amount and right time?

• Will this be a burden, or a blessing?

If you are not sure of these questions, there is not time to waste, contact your SaferWealth advisor today.

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