Insights

The CRA has introduced new tax rules that take effect for your 2023 tax filings. The most significant changes come in the area of trust reporting. You may be thinking to yourself “I am not a trustee or a beneficiary of a trust, so I have nothing to worry about”. Not so fast. The new rules may put requirements on far more Canadians than most people realize. The impact of non-compliance can be significant fines and penalties, so you want to make sure that you remain on the right side of things with the CRA.

Old Age Security is an important benefit for Canadian retirees. But if you earn too much money in retirement, those Old Age Security benefits can be clawed back from you. And there are circumstances where retirees who are not necessarily of high income can have temporary spikes in their retirement income that might cause their Old Age Security benefits to be clawed back.

This week, the government of Canada announced their 2023 Fall Economic Update. The update included a number of measures that are going to impact the finances of Canadians. And the document itself was over 140 pages long. So I went through it and I pulled out the four items that I believe could have the biggest impact on people who are either already retired or who are getting ready to retire. We're going to walk through those four items and I'm going to explain them in a clear and concise way.

In this video, we're going to look at that question through the lens of a monthly cashflow planner. It's my firm belief that a solid financial plan in retirement starts with cashflow, laying out what we need to have coming in the door each month so that we can live comfortably and stay comfortably retired. Then we're going to work our way into the financial plan. We're going to stress test this financial plan, and we're going to come to an answer regarding how much money we need to have saved up to augment other income sources that we're going to have in retirement, specifically Canada Pension Plan and Old Age Security.

If you have been diligently saving throughout your working life, you may be disappointed to learn that at the end of the year you turn 71, you can no longer contribute to an RRSP account in your name. That means no more sweet tax-deductible RRSP contributions. Or, does it? In this video, I am going to describe 2 strategies that you can use to make tax deductible contributions to AN RRSP account that you can use even after you turn 71 years old.

Many retirees know that they have the ability to “split” certain types of retirement income. Pension income, and RRIF income (provided that the annuitant is over the age of 65) can be split with a lower income spouse in order to average down your tax bill. In many cases, retirees are surprised to learn that CPP benefits cannot technically be split on the tax return. They can, however, be shared. CPP sharing can produce the same effect as income splitting but it’s not a perfect process and it takes some work to figure out whether it makes sense for you. In this video, I am going to explain what CPP sharing is and how it works, and the conditions that need to exist so that CPP sharing makes sense for you. Then I am going to close with an example of a hypothetical retirement couple who used CPP pension sharing to lower their lifetime tax bill. And if we haven’t met yet, my name is Mark Walhout. I created this channel to share ideas and concepts that I am using to help people with retirement every day. If you want to get more videos like these consider subscribing to the channel.

Estimating expenses in retirement can be tricky business. After-all, a busy life of work is very different than the life we expect to live while we are retired. We may find it difficult to “stand in the shoes” of our retired selves and estimate how much money they will need when they eventually leave the hustle and bustle of their working career. But, accurately estimating expenses in retirement is a critical step. If we estimate a number that is too high, we may end up putting off or delaying our retirement unnecessarily or leaving a big legacy to our children that wasn’t our intention. If we estimate a number that is too low, we risk depleting our savings too rapidly. Often, when people are faced with these difficult decisions, they either a) put it off or b) search for shortcuts to make the decision simpler. Both of these responses is understandable even though both of them are less than ideal. In this video I am going to talk about a couple of rules of thumb that I see getting used by prospective retirees. I will explain some of the dangers of these approaches. Finally, I will offer a framework for estimating and planning for retirement expenses.

By far, the biggest worry that retirees have is running out of money in retirement. But what if I told you that there is a financial product out there that is structured to pay you guaranteed income throughout your retirement, regardless of how long you live? In this video I am going to talk about the role of annuities in a retirement income plan. I will demonstrate how a hypothetical retiree couple can introduce an income annuity into their retirement plan, boost their guaranteed retirement income, and reduce their stress of running out of money in retirement.

What types of returns should we assume for our retirement projections? This is a question that has come across my desk a few times over the past several weeks. Making reasonable assumptions about what our investment performance could be in the future is a critically important part of good financial planning. If we assume too little, it may cause us to pursue investments that aren’t suitable for our plan. If we assume too much, it could cause us to over-spend and potentially run out of money down the road.