# Cascades Financial Solutions



## Mookie (Feb 29, 2012)

Has anyone tried Cascades Financial Solutions to do an analysis of their retirement plan?

Looking at the sample report on the site, it appears it can do a pretty detailed analysis on whether it makes sense from an overall tax perspective to draw down first from non-registered, or RRSPs.

https://cascadesfs.com/

Thoughts?


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## OnlyMyOpinion (Sep 1, 2013)

I think your estate beneficiaries should pay for the analysis since it determines that 'best strategy' is to die with the most money remaining.


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## Mookie (Feb 29, 2012)

OnlyMyOpinion said:


> I think your estate beneficiaries should pay for the analysis since it determines that 'best strategy' is to die with the most money remaining.


OK, I'll send the bill to my kids.  

But seriously, my goal here is to minimize the total tax bill over our lifetimes, which translates into more money for my wife and I to spend in retirement. We do expect to leave a modest estate to our children, but we certainly don't want to be the richest couple in the graveyard. 

I know there are quite a few people who firmly believe it's *always* best to defer RRSP withdrawals for as long as possible, but I don't believe that's true in all cases. My analysis of my own early retirement plan says that early RRSP withdrawals (before most of my pension income kicks in) makes sense overall. 

If this software can prove me right or wrong, it would be well worth the 85 bucks.


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## OnlyMyOpinion (Sep 1, 2013)

Fair enough. Jonathan Chevreau found it helpful for the same purpose - How you draw down your retirement savings could save you thousands — this program proves it. What seems left unresolved is the schedule by which you can safely spend that extra. Hopefully they will iterate multiple scenarios for you to give some idea of that, and perhaps refresh every 5 years or so?


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## GreatLaker (Mar 23, 2014)

Mookie said:


> But seriously, my goal here is to minimize the total tax bill over our lifetimes, which translates into more money for my wife and I to spend in retirement.


If you want to minimize taxes, keep all your money in non-interest paying accounts like a zero interest chequing account. That way you would avoid paying those pesky dividend taxes and capital gains taxes.

A better way to look at it is to maximize your estate for a given level of portfolio withdrawals. Or conversely maximize your portfolio withdrawals for a given estate value. Jonathan Chevreau said in the article "the emphasis is on finding the 'winning strategy,' defined as providing clients the highest estate value, net of taxes and fees, at the expected life expectancy."



Mookie said:


> I know there are quite a few people who firmly believe it's *always* best to defer RRSP withdrawals for as long as possible, but I don't believe that's true in all cases. My analysis of my own early retirement plan says that early RRSP withdrawals (before most of my pension income kicks in) makes sense overall.


This article discusses reasons to withdraw from various accounts: Which Account Should I Draw First In Retirement? The author suggests reasons to withdraw from tax-deferred accounts first including avoiding OAS clawback, avoiding higher tax rates when the first spouse passes away and the estate goes to the remaining spouse driving up the tax rate, and avoiding a very large RRSP or RRIF on death that gets taxed at a high marginal rate in the estate.

In my case I withdraw an amount annually from my RRSP to hopefully avoid OAS clawback, then take the rest of my annual spending needs from my non-registered account. Once that is spent down I'll withdraw from my tax-deferred RRSP, RRIF & LIRA accounts, then finally TFSA.

Cascades looks like an interesting way to analyze this issue. Please let us know your impressions if you do decide to try it.


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## Mookie (Feb 29, 2012)

OnlyMyOpinion said:


> Fair enough. Jonathan Chevreau found it helpful for the same purpose - How you draw down your retirement savings could save you thousands — this program proves it. What seems left unresolved is the schedule by which you can safely spend that extra. Hopefully they will iterate multiple scenarios for you to give some idea of that, and perhaps refresh every 5 years or so?


Thanks OMO, I've seen the article you mentioned, which is what got me interested in Cascades as a way to double check my strategy as to where to draw funds from first in retirement. 

Regarding the schedule for safely spending our retirement savings, I'm looking at the Variable Percentage Withdrawal for Advanced Users spreadsheet. This appears to be a very robust approach to getting the most out of our retirement savings, while adjusting for variability in market returns. It even adjusts annual suggested withdrawals by accounting for all current and future expected pension income sources so that the overall cash available to spend stays somewhat consistent from year to year.


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## Mookie (Feb 29, 2012)

GreatLaker said:


> If you want to minimize taxes, keep all your money in non-interest paying accounts like a zero interest chequing account. That way you would avoid paying those pesky dividend taxes and capital gains taxes.
> 
> A better way to look at it is to maximize your estate for a given level of portfolio withdrawals. Or conversely maximize your portfolio withdrawals for a given estate value. Jonathan Chevreau said in the article "the emphasis is on finding the 'winning strategy,' defined as providing clients the highest estate value, net of taxes and fees, at the expected life expectancy."


Yeah - a zero interest chequing account. Great strategy! Who needs those fancy tax shelters anyway? 



GreatLaker said:


> This article discusses reasons to withdraw from various accounts: Which Account Should I Draw First In Retirement? The author suggests reasons to withdraw from tax-deferred accounts first including avoiding OAS clawback, avoiding higher tax rates when the first spouse passes away and the estate goes to the remaining spouse driving up the tax rate, and avoiding a very large RRSP or RRIF on death that gets taxed at a high marginal rate in the estate.


Excellent article, which seems to support our current plan to withdraw from RRSPs early while other pension income streams are still low or non-existent. Thank you!


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## PDLD (Jan 3, 2014)

So I decided to splurge and pay the $85 plus tax for the Cascades software... In my case, I was mostly interested in maximizing after tax estate value, and seeing if it made sense to withdraw from the RRSP early regardless of need for income. I am fortunate in that I have no worries about running out of money, and having OAS completely clawed back doesn't bother me. I'm 62 now, single, no kids, and will retire at the end of the year.

My comments:

Takes just a few minutes to enter the relevant information.

Report is clearly presented, and easy to understand.

The end result was more or less what I expected, in that there was surprisingly little difference between using non-registered investments/money first, TFSA money first, or registered funds. According to the software, it makes sense in my case to leave the RRSP money alone until age 71. The difference between the best and worst outcomes was approximately 4.5% of after-tax estate value. 

One fairly big limitation is the available choices for breakdown of investment "styles" it considers: aggressive/growth/conservative/etc., there are only four options. In my case, when I chose "growth" (with 60/40 split, and predicted 6% return) it reported significantly higher yearly capital gains, interest and foreign dividends than I currently receive from my non-registered investments, which are mostly Canadian dividend payers. 

Just my initial impressions after an hour or two. I will keep playing with it for a few more days, but doubt I will be able to create significantly different scenarios.

By the way, I tried hard to make RRIFmetic work (condolences to Steve's family) but the lack of an XP compatible PC made that difficult. From what I heard, it was a more flexible program.


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## simplesimon (Feb 10, 2015)

PDLD said:


> By the way, I tried hard to make RRIFmetic work (condolences to Steve's family) but the lack of an XP compatible PC made that difficult. From what I heard, it was a more flexible program.


I'm successfully running RRIFmetic on a pretty ancient R400 Thinkpad with Windows 10 32bit. Maybe the old hardware is what makes this possible. I'm not using any special compatibility mode.

I'm curious to know how many people still use RRIFmetic? I'm using the 2015.1 version. Of course the tax tables are out of date, but I'm sure it comes close enough for what-iffing.

It's an amazing piece of software.


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## PDLD (Jan 3, 2014)

simplesimon said:


> I'm successfully running RRIFmetic on a pretty ancient R400 Thinkpad with Windows 10 32bit. Maybe the old hardware is what makes this possible. I'm not using any special compatibility mode.
> 
> I'm curious to know how many people still use RRIFmetic? I'm using the 2015.1 version. Of course the tax tables are out of date, but I'm sure it comes close enough for what-iffing.
> 
> It's an amazing piece of software.


Well, you encouraged me to give it another try (running XP Pro in something called VM VirtualBox, on a Windows 10 computer) and got a 2013 Full Demo version running (good for 60 days only). I would have happily paid for a full version back then, if I had been able to get it running on my Windows 10 computer. 

As you said, it really is a wonderful program, much more flexible to use than the Cascades software, allowing many more what-if iterations/scenarios/outcomes. 

The fimetrics.com website is now down, from the looks of it.


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