# Spousal RRSP Question



## jgcpalmer (May 2, 2021)

Hoping you fine folk can help me think this one through. I currently have almost nothing in RRSPs, but this year we're going to start putting in significant amounts, and I just heard of spousal RRSPs today and am wondering how to best use them in my unique situation.

I'm 42, and my wife is 36. I make around $120k, and she is disabled with a degenerative disease, making about 9k on CPP disability. Unless new treatments come to light, she will likely pass away sometime from mid-50s to mid-60s. This means we are unlikely to be able to use income-splitting at retirement, as she will have already passed before we're both 65.

I'm thinking it would make sense to split my RRSPs with her, and potentially when she's around 50 years of age, take the necessary 3 year break from contributing to her RRSPs, and then start withdrawing from them, to get it tax-free / low-tax. We could then be reinvesting that money and/or using it to support her costs at that time, which would likely include long-term care or some sort of in-home nursing support.

What are people's thoughts on this plan? What percentage of my RRSPs should I be contributing into her account? Anything else I'm not thinking of? Actually, any other financial advice for our situation?


----------



## Bananatron (Jan 18, 2021)

Using spousal RRSPs as a 3 year deferred income splitting plan seems like a loophole that hasn't been closed. I've thought about this before with my wife being a low earner as well.

The one downside that stopped me from doing it - which might not concern you - is that as you probably know spousal RRSP's use the high earners room. I'm not sure what happens to that room when they are realized/cashed in on the spouses side. Does that RRSP room go back to the donor? The spouse? Does it just disappear?

And, I may be mistaken but I don't think you need to take a 3 year break, but you can only access funds from 3 years prior. For example if you contributed $10,000 a year in year 4 you would have a $40,000 balance but only have access to $10,000. Someone better versed can correct me on this if I'm wrong.


----------



## jgcpalmer (May 2, 2021)

Bananatron said:


> Using spousal RRSPs as a 3 year deferred income splitting plan seems like a loophole that hasn't been closed. I've thought about this before with my wife being a low earner as well.
> 
> The one downside that stopped me from doing it - which might not concern you - is that as you probably know spousal RRSP's use the high earners room. I'm not sure what happens to that room when they are realized/cashed in on the spouses side. Does that RRSP room go back to the donor? The spouse? Does it just disappear?
> 
> And, I may be mistaken but I don't think you need to take a 3 year break, but you can only access funds from 3 years prior. For example if you contributed $10,000 a year in year 4 you would have a $40,000 balance but only have access to $10,000. Someone better versed can correct me on this if I'm wrong.


Yes, this would use my own contribution room, but assuming we did not have an immediate need for the money we could reinvest in a TFSA or a non-registered investment and it would still save a lot of tax compared to if I just had it in my own RRSPs. The first few thousand withdrawn would be pretty much completely tax free as she makes less than the basic personal exemption.

From everything I’ve read you have to wait 3 years from the last contribution to not get penalized. I think this is precisely to close that loophole so it only gets used for retirement splitting and not for income splitting.


----------



## RussT (Jul 11, 2016)

This is not easy to sort out. I think your plan is a good one but there are a few things to consider. The RRSP contribution room is lost forever if that matters to you. A smaller but still important issue is the loss of the dependent spouse amount during the withdrawal period. And how might the rules change between now and the withdrawal phase?

I would start by determining the tax saving from a spousal contribution today by running the numbers through 2020 tax software. Then I would pretend I was now in the withdrawal phase and run the numbers again. This might turn up some other unforeseen items such as changes in medical expense credits.

There are some very smart people on this forum who will likely have some nuggets to offer.


----------



## jgcpalmer (May 2, 2021)

Thanks for your thoughts, they are good things to think about. I’m not concerned for the loss of contribution room. The point of RRSPs is to defer and lower tax payments, so if this plan lowers it even more, then these RRSPs will have done their job. But yes, the loss in dependent spousal amount (which I honestly didn’t understand when I first posted this) needs to be considered. If I only withdrew a few thousand a year I’d just be shifting money around wasting my contribution room.

I am glad I’ve come online to ask about this! There is a lot I still don’t know. I’ll start crunching the math and hopefully can find more helpful people like you to share advice and fill me in on things I don’t know about.



RussT said:


> This is not easy to sort out. I think your plan is a good one but there are a few things to consider. The RRSP contribution room is lost forever if that matters to you. A smaller but still important issue is the loss of the dependent spouse amount during the withdrawal period. And how might the rules change between now and the withdrawal phase?
> 
> I would start by determining the tax saving from a spousal contribution today by running the numbers through 2020 tax software. Then I would pretend I was now in the withdrawal phase and run the numbers again. This might turn up some other unforeseen items such as changes in medical expense credits.
> 
> There are some very smart people on this forum who will likely have some nuggets to offer.


----------



## ian (Jun 18, 2016)

The real challenge is the amount of crystal ball gazing that sometimes has to be done with regard to future incomes, future incremental tax rates. Pension splitting changed the landscape on this for us with regard to tax planning.

There is also the issue of the spouse's age. The younger the spouse, the longer the money can sit in the couple's spousal RSP growing tax free. We only have 2 years difference but we know others who have 5, 10 years or more age difference. Depending on income, at retirement you also need to watch the OAS claw back numbers. DW, for example, has deferred her OAS until age 70 for several reasons, including claw back.

We used RSP deduction room only when I was in the highest incremental tax bracket. Spousal and regular RSP. Not certain, but other than the age issue, pension splitting may have negated the need for this in our situation. But this is strictly rear view musing.

Some savvy tax expert on this forum may be able to answer this question. Our situation is now set in stone-no more employment income, and a princely sum of $12. left of RSP room for the past eight years so there has been no need to delve into it. Our financial situation changed significantly during my last 10 working years-more than I had imagined that it would. The assumptions that we may have made 15 or 20 years earlier may not have been as valid. Not to mention changes in the tax regime.

One huge change for us is that those last ten working years or more were spent in Alberta instead of BC. The incremental top tax rate dropped by approx. 12 percent. That difference in rates made a substantial difference in tax exposure on a tax shelter previously purchased in BC and to stock options that were exercised in Alberta rather than BC. This delta has now been effectively closed. There were people at the time finding ways to show an Alberta residence vs their true residence of Ontario or BC or some other province that was a much higher tax regime at that time.


----------



## jgcpalmer (May 2, 2021)

Thanks for your thoughts. Was reading about OAS clawback earlier today, as it was something I didn’t previously understand. 
You’re right about the crystal ball gazing. I did some math and if I don’t increase my RRSP contributions and make a modest gain (4% after inflation) and plan to take out 4% of my RRSP each year when retired, then I actually lose a bit of money by having my wife withdraw RRSPs in her 50s due to losing the spousal amount for these years that she withdraws. But if I keep increasing contribution: and/or get a better return, then it pretty quickly shifts the other way.
Using spousal RRSPs isn’t much of a gamble though. Even if the math doesn’t work out to withdraw them early, if we just don’t withdraw, once she’s 65 or passes away, it works the same either way, except for possibly a slightly higher fee in the spousal rrsp.
The increased flexibility seems worth it for me to put a decent chunk into spousal rrsps. In the event that her late-life care becomes very expensive, I would have those rrsps available at a low tax rate to help cover them. 




ian said:


> The real challenge is the amount of crystal ball gazing that sometimes has to be done with regard to future incomes, future incremental tax rates. Pension splitting changed the landscape on this for us with regard to tax planning.
> 
> There is also the issue of the spouse's age. The younger the spouse, the longer the money can sit in the couple's spousal RSP growing tax free. We only have 2 years difference but we know others who have 5, 10 years or more age difference. Depending on income, at retirement you also need to watch the OAS claw back numbers. DW, for example, has deferred her OAS until age 70 for several reasons, including claw back.
> 
> ...


----------



## Numbersman61 (Jan 26, 2015)

My wife, who is ten years younger than me, will not have to convert her RRSP to a RRIF for amother two years. I have been using her age to determine the Minimum Withdrawal Rate from my RRIF. With the dividend gross up and RRIF withdrawals, it is very hard to avoid the clawback.


----------



## jgcpalmer (May 2, 2021)

That sounds like another good reason for me to use the spousal RRSP. If we can withdraw as much RRSPs as possible before I retire at a low tax rate and invest them elsewhere, then that will make for lower income to claim after I’m 65 and more likely I can avoid the clawback.



Numbersman61 said:


> My wife, who is ten years younger than me, will not have to convert her RRSP to a RRIF for amother two years. I have been using her age to determine the Minimum Withdrawal Rate from my RRIF. With the dividend gross up and RRIF withdrawals, it is very hard to avoid the clawback.


----------



## ian (Jun 18, 2016)

I believe that the important thing, in your contributing years, in not leave this on auto pilot and forget about it. At tax time each year review your go forward strategy in view of any CRA changes, any personal changes such as income, lifestyle etc. It really has to be a strategy that you review. Not at all dissimilar to your investment allocation strategy.

Do some research if necessary, buy a subject matter book. At one point prior to retirement we decided for a number of reasons, including a CRA inquiry, that we needed some expert advice. I needed some guidance on a tax shelter issue that was under audit. We engaged a recommended CPA to do a review of our past few tax filings and to handle our tax going forward a few years. This included some tax avoidance.

The professional fees that we paid were able to be written off on our tax returns. The advice and guidance has paid for itself many times over. It gave me a sense of security going into early retirement. Plus tax adjustments on both returns re-filing back five years that far exceeded the professional fees. I wanted to ensure that there would be no surprises if I was audited for any reason and we wanted to manage our resources in the best fashion possible. This included tax planning.


----------



## jgcpalmer (May 2, 2021)

Some good advice there for sure. Definitely feeling like we’ll need some professional expert advice along the way. 




ian said:


> I believe that the important thing, in your contributing years, in not leave this on auto pilot and forget about it. At tax time each year review your go forward strategy in view of any CRA changes, any personal changes such as income, lifestyle etc. It really has to be a strategy that you review. Not at all dissimilar to your investment allocation strategy.
> 
> Do some research if necessary, buy a subject matter book. At one point prior to retirement we decided for a number of reasons, including a CRA inquiry, that we needed some expert advice. I needed some guidance on a tax shelter issue that was under audit. We engaged a recommended CPA to do a review of our past few tax filings and to handle our tax going forward a few years. This included some tax avoidance.
> 
> The professional fees that we paid were able to be written off on our tax returns. The advice and guidance has paid for itself many times over. It gave me a sense of security going into early retirement. Plus tax adjustments on both returns re-filing back five years that far exceeded the professional fees. I wanted to ensure that there would be no surprises if I was audited for any reason and we wanted to manage our resources in the best fashion possible. This included tax planning.


----------



## cardhu (May 26, 2009)

Use of the spousal RRSP is a no-brainer in your case … there really is no downside to using it … the strategy of cycling money through a spousal RRSP and back out again is valid in some cases, but is just a little too popular for its own good, and many people wind up harming themselves by doing it … however, it could be a very good plan in your circumstances, with a few caveats & clarifications …



jgcpalmer said:


> The first few thousand withdrawn would be pretty much completely tax free as she makes less than the basic personal exemption.


As RussT already pointed out, the notion of “tax-free” withdrawals in the spouse’s hands is mostly a myth … the impact on the spousal amount tax credit on your return ensures that a withdrawal will always be taxed, unless both of you are simultaneously below the basic personal amount threshold. Nuff said, Russ covered it.



jgcpalmer said:


> From everything I’ve read you have to wait 3 years from the last contribution to not get penalized.


It is often described that way, but that’s not quite right … it could be as much as 3 years, or it could be as little as 2 years plus a few days … the actual rule is that attribution applies only to the extent that you have made a spousal contribution in the same calendar year (as the withdrawal), or either of the two prior calendar years … therefore, a spousal contribution made in December 2021 is treated no differently, in the attribution rules, than a spousal contribution made in January 2021 … either way, as long as that is the final spousal contribution, the annuitant-spouse would be free and clear to withdraw sans attribution as of January 1, 2024.



jgcpalmer said:


> I’m not concerned for the loss of contribution room.


You should be … this kind of plan backfires on a lot of people … since you don’t appear to have a DBP, the RRSP is by far the most valuable tool available to you, to secure a comfortable retirement. Don’t dismiss it lightly. 



jgcpalmer said:


> The point of RRSPs is to defer and lower tax payments, so if this plan lowers it even more, then these RRSPs will have done their job.


Lowering tax payments is not the point of RRSPs … they are meant to provide a tax-efficient means of funding retirement and they do that by making you wealthier than you otherwise would have been, not by lowering your tax bill … wealthier people often pay more tax than their less-wealthy neighbors … this belief that tax payments must be “lower” in order to benefit from RRSP is common, but it is a myth. 



jgcpalmer said:


> We could then be reinvesting that money and/or using it to support her costs at that time, which would likely include long-term care or some sort of in-home nursing support.


To the extent that you are using the money withdrawn for spending, whether to cover the additional health care costs, or to fund one last blow-out vacation together, it is almost certainly a sound plan … reinvestment, though, is a far less compelling choice 



jgcpalmer said:


> assuming we did not have an immediate need for the money we could reinvest in a TFSA or a non-registered investment and it would still save a lot of tax compared to if I just had it in my own RRSPs.


Reinvesting withdrawals into TFSA is valid, if that is the only way the TFSA can be funded … but drawing from RRSP to reinvest in a non-reg account, not so much … you might start out ahead, by having withdrawn at a rate lower than your marginal rate at contribution … but that lead will be eroded by the ongoing inefficiency of the non-reg investments, and the more time that passes, the greater the erosion … non-reg investment rarely outperforms RRSP investment, over any reasonably lengthy period of time. 



jgcpalmer said:


> What percentage of my RRSPs should I be contributing into her account?


I don’t think it matters much … you want to have enough to support additional health-care spending in her final years, but anything beyond that will revert back to you anyway … start with an equal split and adjust as you see fit, going forward. 



jgcpalmer said:


> Was reading about OAS clawback earlier today


Its good to be aware of it, but its not really much of a factor … IF you end up among the 3% of highest-earning seniors (97% of seniors don’t) then a clawback might make the RRSP less beneficial than it otherwise would have been, but it is quite rare that it flips the RRSP from beneficial to non-beneficial.



jgcpalmer said:


> Actually, any other financial advice for our situation?


One thought comes to mind … actually its not unique to your situation but applies to all married couples with substantial assets … make sure her TFSA is fully funded at all times … as you’ve noted, all opportunities for income splitting will cease after she’s gone … the entire portfolio will revert to you, along with the full tax burden of that portfolio … and any unused TFSA contribution room she has left when she passes is lost, so you want that account to be maxed at all times. Don’t be tempted to use it to support her care costs … the spousal RRSP would be much better suited for that purpose.


----------



## cardhu (May 26, 2009)

Numbersman61 said:


> it is very hard to avoid the clawback.


And yet 97% of the senior population somehow manages to do exactly that.


----------



## Numbersman61 (Jan 26, 2015)

Since I retired 11 years ago, most of my OAS has been clawed back. Did I make a mistake in my investing strategy to land in this situation? My answer in No. In reality, OAS is there to help those less fortunate to assist In their retirement years. When my wife has to start making RRIF withdrawals, she will also see little or no OAS. We consider ourselves very fortunate that our incomes are so high that OAS is not a factor in our retirement planning.


----------



## jgcpalmer (May 2, 2021)

Thank you for your detailed response, cardhu! A lot of this is so new to me. A couple years ago, we were buried in tens of thousands of dollars of unnecessary debt. We're really just getting our financial house in order right now (all debt cleared except mortgage, and now we've almost finished building an emergency fund, and are looking for the best way to save for retirement.)

I do have a couple follow-up questions, so I can better understand your response.



cardhu said:


> You should be … this kind of plan backfires on a lot of people … since you don’t appear to have a DBP, the RRSP is by far the most valuable tool available to you, to secure a comfortable retirement. Don’t dismiss it lightly.


What's a DBP? 

And yes, I'm starting to understand how precious that contribution room is. I just have so much right now as I haven't been putting anything into RRSPs so far, but I can see how cycling it would use up that room, and would only make sense if I absolutely wasn't going to use up that room otherwise.



> Reinvesting withdrawals into TFSA is valid, if that is the only way the TFSA can be funded … but drawing from RRSP to reinvest in a non-reg account, not so much … you might start out ahead, by having withdrawn at a rate lower than your marginal rate at contribution … but that lead will be eroded by the ongoing inefficiency of the non-reg investments, and the more time that passes, the greater the erosion … non-reg investment rarely outperforms RRSP investment, over any reasonably lengthy period of time.


Can you explain this more? How are RRSPs so much better performing and more efficient? Pulling out the money while my wife is still alive would amount to a tax savings likely of around 15% compared to waiting until it rolls back onto me. Would keeping it in an RRSP really make up that 15% difference? I know at some point there is capital gains tax, and I maybe need to research that more, but I feel like that's not what you're talking about. Would love to understand what you're getting at here more.



> One thought comes to mind … actually its not unique to your situation but applies to all married couples with substantial assets … make sure her TFSA is fully funded at all times … as you’ve noted, all opportunities for income splitting will cease after she’s gone … the entire portfolio will revert to you, along with the full tax burden of that portfolio … and any unused TFSA contribution room she has left when she passes is lost, so you want that account to be maxed at all times. Don’t be tempted to use it to support her care costs … the spousal RRSP would be much better suited for that purpose.


This makes sense to me. Should I be funding her TFSA even while I have contribution room for my RRSPs? Or should I only start filling it up once my RRSP contribution room is used up? Right now I have $150K of excess contribution room in my RRSPs, and was assuming I should be using it up before doing TFSA investments.



So to conclude, my ever-evolving plan right now, is that we'll start contributing to RRSPs (going to start with 19% of my salary which includes a 3% match from my employer, and start slowly increasing it every time I get a raise, to use up my contribution room), probably around a 50/50 split or perhaps a bit more into the spousal RRSP. A couple years before we think she might need extra care, we'll stop contributing. After that waiting period comes, we'll withdraw money if:
1) We feel we need extra money to take care of her in her later years.
2) She has TFSA contribution room that we don't think we'll be able to use up otherwise, and fill that TFSA of hers.

It also seems to me that taking the money out in larger chunks (that goes to the top of her 20% bracket) in one or two years is better than spreading it out over several years, because that way I would have the spousal amount to claim on my taxes those years I don't withdraw.

Thoughts on my plan?


----------



## Numbersman61 (Jan 26, 2015)

With regards to your Spouse’s TFSA, make sure that you are the named Successor Holder rather than Beneficiary. This article explains the reason TFSA beneficiary rules: Should you use the successor holder or beneficiary designation? - Retire Happy


----------



## jgcpalmer (May 2, 2021)

Numbersman61 said:


> With regards to your Spouse’s TFSA, make sure that you are the named Successor Holder rather than Beneficiary. This article explains the reason TFSA beneficiary rules: Should you use the successor holder or beneficiary designation? - Retire Happy


Very useful information! And a good website for me to peruse. Thanks!


----------



## Eclectic12 (Oct 20, 2010)

Bananatron said:


> ... The one downside that stopped me from doing it - which might not concern you - is that as you probably know spousal RRSP's use the high earners room. I'm not sure what happens to that room when they are realized/cashed in on the spouses side. Does that RRSP room go back to the donor? The spouse? Does it just disappear?


Not sure what the confusion ... making an RRSP or Spousal RRSP contribution uses up RRSP contribution room, where it is never given back (unlike the TFSA).
The only way to receive more RRSP contribution room - whether one makes a withdrawal or not is to have more earned income that grants more RRSP contribution room.



Bananatron said:


> ... And, I may be mistaken but I don't think you need to take a 3 year break, but you can only access funds from 3 years prior. For example if you contributed $10,000 a year in year 4 you would have a $40,000 balance but only have access to $10,000. Someone better versed can correct me on this if I'm wrong ...


My understanding is that it has to be a three year break.

"If the funds are withdrawn within 3 years of a contribution to a spouse's RRSP, all or part of the withdrawn amount will be taxed as income to the spouse who made the contribution."








TaxTips.ca - Spousal RRSPs & RRIFs, Attribution Rules re Withdrawals


TaxTips.ca - Spousal RRSPs and RRIFs, and attribution rules regarding withdrawals; Withdrawals made within 3 years of spousal contributions will be taxed in the hands of the contributor.




www.taxtips.ca













The facts on spousal RRSP withdrawals - MoneySense


Of all the issues regarding spousal RRSPs, perhaps the least understood are the rules regarding withdrawals




www.moneysense.ca






Cheers


----------



## jgcpalmer (May 2, 2021)

Eclectic12 said:


> My understanding is that it has to be a three year break.
> 
> "If the funds are withdrawn within 3 years of a contribution to a spouse's RRSP, all or part of the withdrawn amount will be taxed as income to the spouse who made the contribution."
> 
> ...


It does appear that if timed right, it could be 2 years plus a few days.
Here's an article that goes into it in more specifics.








Can a spousal RRSP help you save on taxes?


A spousal RRSP might help you pay less tax as a couple. And who wouldn’t want to pay less tax? Find out how it works.



www.sunlife.ca





That said, either way I'd be very careful to make sure I've waited long enough before making the withdrawal.


----------



## Eclectic12 (Oct 20, 2010)

jgcpalmer said:


> ... What's a DBP?


My bet is that it is a defined benefit pension. Cardu can confirm.




jgcpalmer said:


> ... Can you explain this more? How are RRSPs so much better performing and more efficient?


The RRSP is pre-tax so a full $1 can be invested. The TFSA is post-tax so if one's tax rates is say 30% then only $0.70 can be invested.
If one's retirement income is lower, it can work in your favour.




jgcpalmer said:


> ... I know at some point there is capital gains tax, and I maybe need to research that more, but I feel like that's not what you're talking about ...


The RRSP has no Canadian taxes while the funds/investments are in the account. When one withdraws, the funds taken out are taxed as income.
Capital gains taxes would be in a non-registered account, where the inclusion rate of 50% means one is paying tax on $0.50 instead of the full $1 that an RRSP withdrawal would have.





jgcpalmer said:


> ...This makes sense to me. Should I be funding her TFSA even while I have contribution room for my RRSPs? Or should I only start filling it up once my RRSP contribution room is used up? Right now I have $150K of excess contribution room in my RRSPs, and was assuming I should be using it up before doing TFSA investments.


If you are worried about the size of the RRSPs (hers and yours), I'd be tempted to use the Spousal RRSP to generate a refund then use the refund to help fund the TFSAs.
'Course if you have the spare cash to max the TFSA and make some RRSP contributions then it does not matter much IMO.


Cheers


*PS*
Keep in mind that an RRSP or spousal RRSP withdrawal will have a withholding tax (WHT) applied to it as a down payment for the final tax bill that filing the tax return generates.
It is similar to the WHT one's company takes for employment income.








TaxTips.ca - What tax is deducted from RRSP or RRIF withdrawals?


TaxTips.ca - Withholding tax percentage on a withdrawal from an RRSP or RRIF increases as the amount of the withdrawal increases. Fees are not tax deductible




www.taxtips.ca





Also keep in mind that most FIs will charge an RRSP withdrawal fee. 

These two factors are why most will prefer to setup a RRIF. The minimum withdrawal amount is not subject to the WHT and most FIs don't charge a withdrawal fee for a RRIF.


----------



## jgcpalmer (May 2, 2021)

Eclectic12 said:


> The RRSP is pre-tax so a full $1 can be invested. The TFSA is post-tax so if one's tax rates is say 30% then only $0.70 can be invested.
> If one's retirement income is lower, it can work in your favour.


Yes, but I'm comparing against withdrawing my wife's RRSP while she's still alive at a 20% tax, and reinvesting it, vs leaving it until she passes away and rolls over to me, where I will take it out at likely a 35ish percent marginal tax rate.

I was thinking it would be best to withdraw all of it while she is still alive and re-invest, even if it's in non-registered investments, but cardhu was arguing that even with the significantly higher tax rate of letting it roll over into my RRSPs, I'm still better to do that than to reinvest in something non-registered because RRSPs are more efficient. I just want to understand what he means about this.


----------



## ian (Jun 18, 2016)

Why not reach out to some financial advisors or accountants to run the actual longer term numbers using your current best estimates, current tax rates/regime etc, and see what numbers pop our at the bottom of a few short and longer term scenerios. They can input estimates of investment returns, inflation along with other personal and financial data that you provide. Stay away from the ones that are simply trying to sell you investment. You want someone who knows what he or she is doing, has the ability to crunch the numbers, and most of all someone who you are comfortable with.

This may assist you in getting closer to the start of a comprehensive short and longer term financial plan based on your situation. It won't be perfect because of the moving parts but it may give you some peace of mind that you are on the right financial path given your circumstances.


----------



## jgcpalmer (May 2, 2021)

Good advice, and that's the plan. Hoping right now to get ideas on how we'll proceed, and then find a financial advisor to sit down with and see how things could get adjusted or if there's any gotchas that we missed.



ian said:


> Why not reach out to some financial advisors or accountants to run the actual longer term numbers using your current best estimates, current tax rates/regime etc, and see what numbers pop our at the bottom of a few short and longer term scenerios. They can input estimates of investment returns, inflation along with other personal and financial data that you provide
> 
> This may assist you in getting closer to the start of a comprehensive short and longer term financial plan based on your situation. It won't be perfect because of the moving parts but it may give you some peace of mind that you are on the right financial path given your circumstances.


----------



## ian (Jun 18, 2016)

I get the OAP. My spouse does not. No point, every dime would be clawed back. So we decided to wait until she turns 70. By that time I will be in RIF territory, she will be approaching it. We may switch our spousal loan strategy and pension splitting strategy so that she gets OAS and mine is clawed back. And the OAS will be more so there may be something left after a partial clawback.

The number will make the decision for us. Don't care about OAS claw back, do not view it as an entitlement. If anything, I would like to see the clawback increased IF the more money could go to those seniors on GIS.

The thing is, twenty years or more ago we never thought that we would be in this situation when we started doing spousal RSPs. You can make all the plans you want and they will have merit at the time. But circumstanced do, and will change. Either your personal circumstances or the tax regime.


----------

