Annuity  A contract under which a series of periodic payments are made by a financial institution to an individual for a specified period of time. These payments are usually made monthly.

Beneficiary  A person designated as the recipient of funds or other property under a will, trust, insurance policy,etc.

Buy/Sell Insurance  A contract between two or more persons, generally with a business relationship, setting out the conditions under which one may buy out the otherís interest. It is usually funded by life insurance, in full or in part.

Critical Illness Insurance  Coverage that provides a lump-sum payment should you be diagnosed with a critical illness and survive a pre-determined period of time. There are no restrictions on how you use your benefit.

Defined Contribution Pension Plan  A pension plan that describes the plan sponsor's annual contribution to the plan on behalf of each plan participant.  At retirement, the amount of a participant's benefit is calculated based on the accumulated value of contributions made by, or on behalf of, the participant.  Also, known as a money purchase plan.

Disability Insurance  A type of insurance that allows for payments of a benefit to the insured party if the individual is unable to work due to illness or injury.  Also called: disability coverage - income, salary insurance, weekly indemnity, short or long term salary insurance, and short or long term disability, depending on the type of insurance.

Dollar Cost Averaging  The periodical investment of a fixed amount in a particular investment at regular set intervals, regardless of the unit or share price, usually resulting in the average cost of the units/shares being lower than the average of their prices.

Estate Planning  The arrangement of an individual's affairs to facilitate the passage of assets to heirs and minimize inheritance taxes owing.

Financial Planning  The provision of financial advice taking into account an individual's personal financial situation.

Group Insurance  An insurance contract entered into by an organization buying insurance for a designated group of people. (e.g., employees of a company or members of an association).

Group RSP  An employer-sponsored RRSP under which each participating employee has an account. Both the employer and the employee can contribute to the plan up to a certain maximum. The employer's contributions are considered taxable income for the employee who may, however, obtain an RRSP tax deduction for the amount involved. For the employer, the contributions are tax-deductible as payroll expenditures.

Guaranteed Investment Certificates (GIC)  A secure investment that guarantees the original amount that you invested.  When you buy a GIC, you are agreeing to lend the financial institution your money for a specified period of time.  In exchange, your money will earn interest, at either a fixed or a variable rate, or based on a pre-determined formula.

Key Man Insurance  Insurance on the life of a key employee in a business, designed to provide cash to hire and train a replacement and replace lost revenues and profits in the event of the death of the employee.

Life Insurance  A type of insurance that pays a benefit upon the death of the insured party.
Also known as death coverage.

Long Term Care Insurance  Coverage that provides nursing-home care, home-health care, personal or adult day care usually for individuals above the age of 65 or with a chronic or disabling condition that needs constant supervision.

Mutual Funds  An investment vehicle made up of a pool of moneys collected from many investors to be invested on their collective behalf.  When you invest in a mutual fund, you purchase units in a professionally managed portfolio of securities, with each unit representing a share of ownership in the portfolio.

Pension Plan  A plan under which members are paid retirement benefits under certain terms starting at a given age. Such plans are usually financed with contributions paid either by the employer alone or by both the employer and the member.

Profit Sharing (DPSP)  A profit-sharing plan whereby an employer makes contributions based on the organization's annual profits to a trust for the benefit of employees.

RESPs  A plan registered under the Income Tax Act allowing the participant to accumulate tax-sheltered amounts that are held in trust to be used to cover eligible postsecondary education costs for a beneficiary.

RIFs  A tax-deferral mechanism available to holders of a Registered Retirement Savings Plan (RRSP). Holders invest the amount withdrawn from their RSSP in this fund, from which they withdraw a certain fraction annually. The amount taken out becomes taxable.

RRSPs  A Registered Retirement Savings Plan, registered with the Canadian Federal government, allowing you to save for the future on a tax-sheltered basis.  It is a means by which individuals may defer taxes due on savings invested for their retirement.  The funds are invested in a variety of investment instruments held in trust under the plan.  Taxes due on the contributions made and return on investment are deferred until the funds are withdrawn upon retirement.


Universal Life Insurance  Type of life insurance that offers a savings component in addition to an insurance component. Savings are made through the investment of surplus premiums and yields a return to the policyowner.