# Asset de accumulation



## TimStevens (Sep 19, 2013)

My wife and I are both 58 years old. We have a joint taxable account worth $800,000 and I have my own RSP worth $226,000, a Locked in RSP worth $67,000, a spousal RSP worth $130,000 and a TFSA with $28000 in it. My wife has a similiar sized TFSA plus her own RRSP worth $440,000. We also hold a mortgage for my mom worth $125,000 and another $100,000 mortgage for our daughter. I have around $200,000 in the bank on deposit as cash. For me, given that I'm going to retire in about a year or two, how do I maximize my after tax retirement income??? CPP, OAS, Pension Income Credit and Pension Income splitting...I've heard of all of these things here and there but I really don't know how to put all of these things together.


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## heyjude (May 16, 2009)

Yes, it can get quite complicated! It might be helpful to read this book for starters:

http://www.boomersblueprint.com


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## Ihatetaxes (May 5, 2010)

You need Steve's software at http://www.fimetrics.com/


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## pacman (Sep 6, 2009)

Ihatetaxes said:


> You need Steve's software at http://www.fimetrics.com/


:encouragement:


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## kcowan (Jul 1, 2010)

I would try to get a handle on your spending. You have a couple of years to track and record. Once you master that then you know how much you need to cover. But first start getting a track on all your investments. What do they return monthly, annually? These are all input assumptions that any tool will need. At that point, a planning tool should help.


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## OnlyMyOpinion (Sep 1, 2013)

Well you shouldn't have any problem having sufficient annual income or a concern with outliving your assets.
We have a similar challenge - streaming the various assets most tax efficiently.

As kcowan noted, you need to know what your current and expected expenses are - how much income will I need in retirement. And also what income your various accounts are currently generating. You may already have these and just didn't mention it.
We went online to the servicecanada.gc.ca and set up accounts to acccess our CPP history of contributions. A very poorly designed site in our opinion (our tax dollars at work). 

Are you handy with excel? We were interested in understanding if our multiple sources of retirement income would combine to give us what we need till death and how long each will last depending on assumptions of withdrawl and growth, minimum required withdrawl amounts etc. We did the following - but its important to realize it was a simple approach that does not consider the after-tax efficiency of the various sources or the optimal tax efficient combination for withdrawl, or tax brackets and OAS clawback, etc. - all the stuff that you are asking about.
But it did at least help us understand our pre-tax 'moving parts':
In excel we created a column for each of our sources of income - his cpp, her ccp, his rsp, her rsp, joint taxable trading acc, dc pension, etc. 
An estimate of the account value at retirement is entered at the top of each column. Each row represents the year of withdrawl and the balance of each account is reduced by the annual withdrawl while the remaining balance earns an assumed real rate of return (which you can change). Also columns of the min and max withdrawl rates allowed/required from your RRSP or DC pension. A final column then shows the sum of the withdrawls from all accounts for each year - this is the total amount of income you feel you need each year. Then you can go in and play with different scenarios - take RRSP early and let trading acc grow, draw from trading acc and leave RRSP till later, etc. 

As noted, we haven't considered taxes or tax brackets yet. As we understand it, every dollar from an RRSP is txbl income regardless of what it is invested in, while income from our taxable account depends (as it does now) on the type of investments being held (eligible dividends, interest, capital gains).

Haven't looked at the software recommended, but will have to look at choices out there in that regard. Spending $400 on software seems a lot - but then duh, we have to keep its value in perspective and it could be substantial. Guess being frugal over the years is why we have these 'problems' to solve now.


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