For years the plan was simple. Save. Invest. Repeat. Say no a lot. 😅 Then one day you're retired and nobody hands you the manual for the next part. Because pulling money OUT is a whole different game than putting it in. And honestly, nobody talks about it nearly as much. 🤔 Here's what I'd like to discuss with you: ▪️ Which account do you spend from first? ▪️ Do you drain the RRSP early to keep the tax bill smooth, or let it grow and deal with it later? ▪️ Do you protect the TFSA like it's gold and touch it last? ▪️ Where does the non-registered account fit in? ▪️ When do you start CPP and OAS, and does that change the order of everything else? Every answer seems to come with a "well, it depends." 🙄 Tax brackets, OAS clawback, RRIF minimums, your spouse's income. It all pulls in different directions. I have my own thoughts on this (you know me, boring and steady), but I want to hear yours first. 👇 Tell me: 1️⃣ Are you retired, or close? What does your withdrawal order look like? 2️⃣ What worked? What would you do differently? 3️⃣ Anything that caught you off guard once the paycheques stopped? The real stories are always better than the theory. Let's help each other figure this out. 💛 Not financial advice. DYOR. Everyone's tax situation is different.
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RJ Gilbert
@rjg1876 · 20h
This is a very relevant discussion and Lisa is correct, less conversation around this part of your retirement but very important. I’m retired for a year, I have a company pension plus other vehicles that I invested in over the years. Love Blossom as we have so many young investors and no matter how old, just start with any amount you can afford and keep contributing. Time is your key asset!! You can’t get more. I’m pulling from my RRSP, but you can convert up 50% of your RRSPs to a RRIF prior to 71, one time allowed. This is important because, say you draw from TFSA first and then do not pull from your RRSP, then the conversion happens at 71 and you are required to pull 5.28% the first 4 years increasing beyond that which, depending on how much you have, will place you in higher tax brackets. It’s important to draw down your RRSP so at 71, you are not getting killed on taxes. There are all other kinds of strategies to lower your taxes, so good tax attorneys or CFP professionals are essential to help to ensure your retirement funds last. I still practice investing, in individual stocks as I love all things investing, but love the community to help younger people retire with no worries and early to enjoy life from years of hard work.
@retired you opened up a can of worms on this one lol. Brain at Calmoneycoach (find on instagram, has web page and free calculators I may have misspelled it!)) has been doing great videos and angles on this lately. NOT the “calmoneycoach” on here - that clearly is not him (American and 12 people). Brian is Canadian and a wealth of knowledge. Psychology plays a huge factor, and each persons take. I get that some people want to leave a large inheritance or have a fear of running out so want to avoid that at all costs. Others (more me) have an attitude that I’d rather help my son now if he’s struggling to pay for university, then have him be in debt and struggle for the next few decades and then when he’s old he can give my money to his grandkids. Creates a cycle. But I “get it”. Everyone’s different. For me, I’m doing the retirement thing in steps. I’m 50. Got a 26-27 year pension that can pay the basics to live. Have a full TFSA and solid RRSP / non registered (I’m not buying yachts, but I like a nice bottle of wine and good beach now and then). My plan is to cut back to working about 50% of the time for the next 5+ years. During that time I won’t touch any investments. I’ll continue to contribute to TFSA to keep it maxed. But the money I make from 50% work: that’s trips, enjoying life. No sense in waiting till I’m broken or dead to enjoy a trip or beach or time with my kid somewhere. After 5 years I’ll know where things sit. Figure out slow withdrawals after I cut back hours even more. Or realize I should work 25% of the time still. Or I’ll get hit by a bus. 🤷♂️. We have no idea what next week brings. Don’t want to end up with $0 and need help. But also want memories and not have regret. Healthy balance. My mind: saving the RRSP for as long as I can as insurance. If I’m old and can’t do anything and happened to get taxed more to force use it - oh well. It all worked out then. Non registered is unplanned needs / wants. Not basic living expenses. TFSA will have to a calculated factor the most. In my opinion that’s the real tricky one to guess.
Am @whatsa · 20h
Retired last year. Converted all investments to CC etf about a year and a bit before retiring. Kept tweaking mix for income and tax efficiency. Settled on a scenario of withdrawing about 90% of RRSP income or about 20% of account balance. There is a 1 month cash flow wedge in each RRSP and we are each paid twice a month. Large margin account will be the main investment savings vehicle going forward. Investments are CDN CC ETF’s that have high levels of ROC with remainder capital gains and dividends. So while the tax bill is painful from the RRSP withdrawals, it is manageable. I decided I am not leaving $$ to grow in to a bigger deferred tax bomb in the RRSP’s. RRSP withdrawals fund margin account investments, income pays interest. Income surplus pays expenses not covered by pension and CPP. .TFSA’s were cashed out to pay off mortgage debit that I was sick of looking at. So they will be maxed out hopefully next year and then function as savings investment accounts only. This framework works well for us. Strongly recommend you track all income and tax exposure so you can make good investment decisions and not have any tax surprises. I have my own excel spreadsheet and also use Snowball analytics. Happy investing and retirement.
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