Posted on: February 11, 2014
It is that time of year again when attention turns to RRSPs and tax planning. This year's contribution deadline is March 3rd, 2014 if you want to deduct the contribution against your 2013 income tax return.
The purpose for making an RRSP contribution, from a financial planning perspective, is to build savings and assets over time so that you can replace earned employment income with passive or investment income for your retirement years. In other words you can sleep in and still have the lifestyle you want without going to work!
Posted on: February 11, 2014
In our previous article, we looked at how seniors generally wish to invest their money to feel safe while in reality their expenses rise throughout their retirement years as the cost of various services, such as hydro and property taxes, typically increase annually. ( See graph at bottom )
Your choices are to either decrease your spending or deplete your savings or some combination of the two in order to make ends meet. The challenge is to make sure you don't run out of money before you run of time!
Posted on: January 14, 2014
In the mid - 1960s conventional wisdom or motherhood for retirement planning said that you should take all of your investments and put them into government bonds or fixed income type products. The thinking was that you could not afford to take any 'risk' in your retirement years. Thus it was believed that guaranteed investing was the best approach to retirement planning and they were correct at that time.
Posted on: October 14, 2013
Canadians are living longer, healthier lives. According to Statistics Canada (2012), the average life expectancy is 78 years for men and 83 years for women. This means your retirement years may almost equal your working ones. Family therapist Rhonda Katz suggests taking some time before retirement to identify what you find enjoyable in life and thinking of ways to sustain that happiness level. She also says to honestly answer the following questions:
'Is there some aspect of my job that I would love to keep doing?'
Posted on: April 9, 2013
In the aftermath of the US housing market bust and the ensuing financial meltdown that led to global stock market declines of 2008, people are getting back to the basics as far as their retirement planning goes. Although the stock market has recovered, many pre-retirees have lost a lot of ground in their retirement accounts and are facing a new reality. Retirement may not be what they had originally envisioned; but with some retirement income 101 basics, most people should be able to get back on track.
Start with Realistic Assumptions
Posted on: November 13, 2012
Roger and Linda, like many Canadians, have saved for years for their retirement. They took advantage of RRSPs and now have a substantial amount of savings. As Roger will turn age 71 this year, they need to decide on the best strategy for using their RRSPs for their retirement income needs.
Until now, Roger and Linda have been relying on their non-RRSP investments and government benefits so their RRSPs could continue to grow tax-postponed. Roger has to choose from the following by the end of the year or all his RRSP funds will be fully taxed:
Posted on: July 10, 2012
Tax Free Savings Accounts (TFSAs) were introduced in 2009 and they seem to be struggling to catch on. Registered Retirement Savings Plans (RRSPs), however, have been around for over fifty years and attract billions of dollars of deposits each year. If you are serious about saving for your future, it is important to know the differences between the two.
While RRSPs and TFSAs seem to be very similar on the surface, they are really apples and kumquats apart. The only similarity is that, within limitations, earnings inside either plan are allowed to grow without current taxation.
Posted on: February 14, 2012
Recent surveys* reveal that a large majority of so-called Baby Boomers are uncertain about their preparation for retirement. Arguably, the have it my way? generation did not all follow in their parents' footsteps when it came to saving for the future. As well, some major bumps along the way (a housing crisis, a stock market crash and a global financial crisis) have reduced many retirement 'nest eggs.'
Posted on: January 10, 2012
In a 2010 report to the Minister of Finance, it was found that approximately 160,000 Canadian seniors were not aware of the full range of benefits they were entitled to in their retirement years. In fact, nearly $1 billion in retirement benefits from the Canada Pension Plan (CPP), Old Age Security (OAS) and the Guaranteed Income Supplement (GIS) have not been paid out to eligible recipients.
According to the Service Canada website, seniors may qualify for a number of income supplement programs that would help them make ends meet, including:
Posted on: July 1, 2011
Bob and Lisa are wondering just how their retirement will turn out. After all that's happened over the past few of years, their RRSP accounts aren't what they used to be. Even in the best of times, the accounts weren't as large as they could have been, at least for all their post-retirement desires.