Withdrawing from RRSPs before age 71? - Page 8
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Thread: Withdrawing from RRSPs before age 71?

  1. #71
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    Quote Originally Posted by My Own Advisor View Post
    Have folks played with this or used something similar?

    I played with the numbers assuming $500k to start, at age 60 with 6% ROR to withdraw $30k annually. Money seems to last until 93/94.
    $500K starting at age 60 (6% ROR and 2% inflation, living in BC) results in a $36.8 K lifestyle, dying broke at age 95.


  2. #72
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    Quote Originally Posted by My Own Advisor View Post
    Have folks played with this or used something similar?
    http://www.taxtips.ca/calculators/rr...calculator.htm

    I played with the numbers assuming $500k to start, at age 60 with 6% ROR to withdraw $30k annually. Money seems to last until 93/94.

    nice

  3. #73
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    Gibor, You may already have all this sorted out, and I'm not suggesting you post it all.
    OnlyMyOpinoin, I have just plan and I'd like to know if I miss something in my estimations
    Frankly, the difference between paying $1.5k of tax at age 52 versus $2.8k at age 65 doesn't seem a compelling reason to make an irreversabe switch to rrifs at age 52 unless it is all part of a well considered plan.

    For example, if you start rrifs at age 52 you will compromise their tax-sheltered growth and have reduced amounts remaining at age 60, 65, or 72 - is this baked into your numbers? And if you draw $7k a year from your non-reg beginning at age 52, how much will be left at age 60 or age 65 and how long will it last? - you show $7k/yr still from non-reg). If you draw $14k instead and leave rrsp's untouched what is the result? Alternatively, if you take more from rrifs and leave non-reg untouched, etc ....
    $7K from non-reg is only annual interest , I don't intent to withdraw this money , maybe some small portions , but definitely not 7K per year.

    I also will not really miss RIFFs " tax-sheltered growth", as my wife (who has high income) will open new Spousal RRSP and will be contribution annually 6-7K (all room left after her pension adjustments) - thus I will pay on my income very small tax (very low tax bracket) and my wife will pay much less taxes es she is in the highest possible bracket.
    I also intend first to withdraw from RRIFs cash portion that give me only 0.75% interest, this cash I can deploy in non-reg HISA and get at least 2% interest.

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  5. #74
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    @Steve, thanks as always. Your software is probably more accurate.
    Hidden Content - Working on a $1 million portfolio and $30k per year from it.

  6. #75
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    Going through this with my mom who plans to retire at 55. Has around 600k In her RRSP at this moment. Will get a pension from work, oas, cpp, etc. Basically, to minimize her tax burden she may as well deplete her RRSP starting as soon as she retires without converting to a RRIF.

    Figure she would take out 30k per year, 9k in withholding tax, her marginal rate would be minisicule on 30k and she would most likely get around a 6k refund. therefore nearly 3k in taxes. She can do this until she has depleted this and take her work pension when she gets old enough (70) and this way she can minimize taxes during those years nearly would be less than 10% overall tax she would be paying + income from her TFSA which she can generate and this would allow her to minimize her tax burden later on when she receives her pension from work + cpp and oas and minimze the OAS clawback.

  7. #76
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    Quote Originally Posted by steve41 View Post
    $500K starting at age 60 (6% ROR and 2% inflation, living in BC) results in a $36.8 K lifestyle, dying broke at age 95.
    If you manage to make it to 95 with dementia setting in, you won't be worrying whether you are broke or not.

  8. #77
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    @reds,

    Wow, seems like your mom is in great shape depending upon expenses = 1) $600k RRSP + 2) workplace pension + 3) CPP + 4) OAS.

    Before tax I would assume conservatively 1) $30k + 2) $20k (?) + 3) $5k + 4) $5k.
    Hidden Content - Working on a $1 million portfolio and $30k per year from it.

  9. #78
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    Quote Originally Posted by My Own Advisor View Post
    @reds,

    Wow, seems like your mom is in great shape depending upon expenses = 1) $600k RRSP + 2) workplace pension + 3) CPP + 4) OAS.

    Before tax I would assume conservatively 1) $30k + 2) $20k (?) + 3) $5k + 4) $5k.
    she is pretty set yeah, and not to mention the house, etc. my parents did really well in terms of planning for the future and utilized what they worked so hard for.

    i am glad that she will be able to enjoy herself. she has worked full time 25 years + and raised 4 kids while my dad worked his ass off to build his business.

  10. #79
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    Going through this with my mom who plans to retire at 55. Has around 600k In her RRSP at this moment. Will get a pension from work, oas, cpp, etc. Basically, to minimize her tax burden she may as well deplete her RRSP starting as soon as she retires without converting to a RRIF.
    She can also deplete her RRIF with converting RRSP to RRIF abd saving on redemption fees

  11. #80
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    Quote Originally Posted by gibor365 View Post
    She can also deplete her RRIF with converting RRSP to RRIF abd saving on redemption fees
    she works at the bank i she wont get redemption fees. the withholding taxes will still be there. the thing about the RRIF is it will be mandatory withdrawals which will give her more than what she needs and increase her tax liability.

    Last edited by redsgomarching; 2017-03-20 at 05:10 PM.

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