# 5-1/2 months to go - final planning



## skiwest (Oct 24, 2011)

End of Nov is my date and everything is on schedule or a bit ahead.

Snapshot of plan

rate of return 5%, inflation 2%
Allow for budget withdraw $60K 2013 $
bottom up est $55K required
OAS not included in calc
80% max CPP( 33 years max contribute) + 64% CPP + 15K DB in todays $ all at 65
expenses drop by 10% at 80
Amount calculated required $1,000,000 ( younger spouse to 100)
amount target $1,150,000 , so 15% buffer

about 1/3 non registered 2/3rd registered split with 60/40 split in assets between spouses

For first year just want to make it simple and retain money in corp and pay myself $80K including taxes in Jan 2014. After that was planning on taking income from taxable accounts and balance from RRSP. Just take out $60 or $50K every Jan and have that money for rest of year. Thats the part that not sure of best way to work it.


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## lonewolf (Jun 12, 2012)

skiwest

End of Nov is date for what ? retiring

One way to do it is to not take RRSP out till mandatory age. Give up Canadian residency & financial ties remain Canadian citizen take money out of RRSP @ something like 25% tax.


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## skiwest (Oct 24, 2011)

Yes taking early retirement at 53. My question in a another way , with my split of assets and assume I'll be in equity whether in reg or non reg, which is the best way to min long term tax. I've seen people say take down your non reg first so reg can grow tax free. But I'm thinking as tax rate is low do a mix. Take income from non reg and capital gains and let the long term div income producers role. And make up diff required with RRSP withdrawls.


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## Karen (Jul 24, 2010)

I admit to being a huge coward when it comes to retirement money - as I've said before on this forum I keep everything I own in GICs - but it makes me nervous to read about people retiring early and counting on a 5% return on investments and only 2% inflation. You're very young to be retiring and a lot can change in a few years time. I'm one of the generation who lived through several years of inflation in the teens and, while I'm enjoying the current low rates of inflation, I certainly don't take them for granted.

Before making a final decision, I'd recalculate your numbers, cutting back your return on investment and at least tripling your rate of inflation, and then see if your numbers still look good.


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## steve41 (Apr 18, 2009)

The model I use is to shelter your RRSP except when you are below the zero tax threshold, then take enough RRSP withdrawal to keep just below it. Seems to work best except in the case where you are anticipating an early demise.... in which case, start to attack your RRSP.


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## My Own Advisor (Sep 24, 2012)

Non-reg. dividends are quite tax efficient.

I say start drawing down RRSP, bit by bit, minimizing withholding taxes.


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## skiwest (Oct 24, 2011)

Karen said:


> I admit to being a huge coward when it comes to retirement money - as I've said before on this forum I keep everything I own in GICs - but it makes me nervous to read about people retiring early and counting on a 5% return on investments and only 2% inflation. You're very young to be retiring and a lot can change in a few years time. I'm one of the generation who lived through several years of inflation in the teens and, while I'm enjoying the current low rates of inflation, I certainly don't take them for granted.
> 
> Before making a final decision, I'd recalculate your numbers, cutting back your return on investment and at least tripling your rate of inflation, and then see if your numbers still look good.


I can when I include the bottom est of expenses which still has some fat as the withdraw amount ( change 60k to 55K) and increase inflation to 4% so 1% rate of real return it still works when I include the 15% buffer. Well I can get to 101 years. Probably at the age won't be spending $2000 a year on ski passes or wife will have horses.


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## Karen (Jul 24, 2010)

Then go for it, skiwest -I LOVE being retired! No, I doubt very much that you'll still skiing at 101, but one never knows these days; the Vancouver Sun had an article last week about a man who still plays tennis at 100! He was quoted as saying: "100 is the new 90"!"


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## Toronto.gal (Jan 8, 2010)

skiwest said:


> Well I can get to 101 years. Probably at the age won't be spending $2000 a year on ski passes......


Probably not, but you might discover another more costly passion before then, ie: mountaineering, as adventurer Yuichiro Miura did at age 80.  

Freedom 53 sounds great, so enjoy a fun-filled retirement skiwest! 

*Karen:* that decade reduction starts at 40. :biggrin:


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## cannew (Jun 19, 2011)

Karen said:


> I admit to being a huge coward when it comes to retirement money - as I've said before on this forum I keep everything I own in GICs -


Other than the name you could be my sister (she's 75). She has been complaining about the low interest rates for the past four years as her gic's mature. She lives off her pension and the gic's are just savings. I finally got her to consider investing in stocks by suggesting she buy the stock of bank where she has been keeping the gic's. The bank dividend is currently 4.14% while the gic pays 1.8%. Plus the dividend for the bank is growing (even though they did suspend increases for two years). Is there a risk? certainly, but the bank has been paying a dividend since "1832" and I don't believe they ever cut it.


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## skiwest (Oct 24, 2011)

Toronto.gal said:


> Probably not, but you might discover another more costly passion before then, ie: mountaineering, as adventurer Yuichiro Miura did at age 80.
> 
> Freedom 53 sounds great, so enjoy a fun-filled retirement skiwest!
> 
> *Karen:* that decade reduction starts at 40. :biggrin:


Mountainteering for me would be cheap as I could bike to a mountain. Last hike saw 3 mountain goats.


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