Last year before retirement. What do I need to do?
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Thread: Last year before retirement. What do I need to do?

  1. #1
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    Last year before retirement. What do I need to do?

    I was on a trajectory to retire in 2019 but my father recently passed and we've decided to pull the plug at the end of 2017. We would retire now but there are tax advantages to begin selling our real estate in 2018 when I will not be working. I might as well finish the work year.

    I want to be as efficient as possible.

    What do I need to do to prepare?


  2. #2
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    Efficient as in what? How? You don't provide any information for anyone to comment on... other than yes, it could be wise to defer a bunch of cap gains from investment RE to 2018 when you will/could/might be in a lower marginal tax bracket than in 2017.

    What happens when you quit working at the end of 2017? Where does your cash flow come from? Savings? Investment income? DB pension? Crystallizing some withdrawals from an RRSP each year? Is your RRSP fully funded? TFSA fully funded?

  3. #3
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    I was going to ask the same questions...

    Lots of consider!

    I would add:
    -Can you fund basic expenses based on your dividends/distributions/other from capital alone?
    -If not, what have you selected as your initial draw down rate? How did you arrive at that number?
    -What accounts will you draw down first? Why? How did you arrive at that priority? (e.g., registered before non-registered?)
    -What do you have in place in terms of healthcare insurance?
    -Life insurance?

    In terms of preparation, likely a revised IPS.

    Great place to be in Tom, jealous
    Hidden Content - Working on a $1 million portfolio and $30k per year from it.

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    Added: If you don't have a HELOC and want to have one in place just in case you might need it in the future, do it while you still have employment income (before you retire).... OR if you have a lot of money in investments, e.g. $500k in brokerage assets, banks will be glad to extend a HELOC anyway.

  6. #5
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    Quote Originally Posted by AltaRed View Post
    Efficient as in what? How? You don't provide any information for anyone to comment on...

    What happens when you quit working at the end of 2017? Where does your cash flow come from? Savings? Investment income? DB pension? Crystallizing some withdrawals from an RRSP each year? Is your RRSP fully funded? TFSA fully funded?
    True, virtually zero information provided. But, maybe then, there is a surfeit of info. A bit of reading between the lines is required. Father passed. Tom inherits Vancouver house worth $5 million. Hence a good start to retirement.

  7. #6
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    Sorry to hear about your dad...happy to hear you will pull the plug early. After 8 years of retirement these are the things I wish I had done differently.

    1.Retire even earlier
    2.Put everything other than RRSP & TSFA money into a joint Investors Edge account.
    3.Start my RRIF right away.
    4.Eliminate any fiscal ties and responsibilities to my previous business.
    5.Did I mention retire earlier?

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    Thank you for the info provided. The help is appreciated.

    I'm not comfortable sharing personal financial and net worth info on the internet. I was hoping for more broad ideas, such as the good heloc info.

    No 5m house in Vancouver. No inheritance but I will be selling 1 or two properties per year for several years. We've done well.

    I come from poverty so I feel financially successful. Being poor when you are young is an excellent motivator.

    At this point, I have no idea why we planned to work so long. Money will not be an issue and it wouldn't have been for some time. We will be saving money in our retirement and we have no children.

    My car is a 10 year old VW and I just got it. We love it. Its in amazing condition but I've done the timing belt and all service, etc. It's the first leather interior I've ever owned.

    We have the power of being happy in a non consumerist lifestyle. My wife taught me this.

    We got to where we are by prioritizing spending on productive assets. That includes distributing stock, property, etc. I often feel that I can't afford to go out for lunch but I don't think twice about buying end mills for my CNC equipment or sheet goods for a new kitchen in a Reno property.

    I plan to carry on with a small business but most of the work will probably be charity work.

    I don't know what else i can share. It's a matter of having my perspective and priorities changed by a life event so I need some new plans.

  9. #8
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    Condolences over the loss of your father.

    I'm confused, why do you have 2 different accounts?

    Anyway, from this post and what I've seen of your previous posts, you are clearly a high net worth family. You probably want to find a good tax consultant who can work with you on all of the details on how to best optimize your property sales, RRIF withdrawals, timing of taking CPP & OAS.

    Also by the sounds of it, your retirement plan will have money to spare. You seem to be quite philanthropic, I'm assuming you've started to give thought to what you want to happen to any leftover money, possibly a charity if not extended family?

  10. #9
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    Quote Originally Posted by TomB16 View Post

    What do I need to do to prepare?

    Quote Originally Posted by TomB19 View Post
    At this point, I have no idea why we planned to work so long. Money will not be an issue and it wouldn't have been for some time. We will be saving money in our retirement and we have no children.

    I plan to carry on with a small business but most of the work will probably be charity work.

    I don't know what else i can share. It's a matter of having my perspective and priorities changed by a life event so I need some new plans.
    Tom, you are getting some financial advice here, but I am not sure that is what you asked for or need.

    You say money will not be an issue and, indeed, you will be in the happy position of having money surplus to your needs - you say you'll be saving in retirement. So it seems you are not seeking direction re finances. But you ask: "What do I need to do to prepare?"

    It also appears you have answered your own question, at least in part. Small business and charity work. It sounds like the business is operational now, so you already know what it's about. So, are you looking for more ideas about how to use your time? You do not mention your age bracket, region where you live or much else, so apart from some general ideas about finances, I am not sure how much useful info people here can provide.

  11. #10
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    No need to share details Tom.

    It seems you've started to think through a number of things, which is great.

    "My car is a 10 year old VW and I just got it. We love it."

    You strike me as frugal or thrifty, this will serve you well in retirement. It also sounds like you have money to spare, well done. Maybe you need to "prepare" for how to spend since you've saved so much. A good problem to have. Enjoy

    Hidden Content - Working on a $1 million portfolio and $30k per year from it.

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