I’m decades from retirement. Do I really need to contribute to my RRSP? + MORE Mar 15th

Not sure how to make a retirement plan? Read on…
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 registered retirement savings plan

How to calculate the taxable amount for a cashed-in whole life insurance policy + MORE Apr 19th

Ask MoneySense I cashed in my whole life insurance policy last year and received a T5 suggesting I have to pay tax on the full amount of my cash value. Is this correct? The cash surrender value was $27,000, I paid $28,000 in premiums, and they told me my pure cost of net insurance was $30,000, whate.... More »

Where should working retirees put extra income: A TFSA or an RRSP? Jan 11th

Ask MoneySense I will be receiving CPP and OAS as of June 2024. I intend on working one more year until I reach 66. My question is: Should I put all my CPP money into an RRSP to shelter it from tax? Or should I pay the tax on it and invest in a tax-free savings account? –Gary Where to put r.... More »

Contribute to RRSP or pay off mortgage? Oct 12th

Ask MoneySense We have a small mortgage, only $80,000, coming up for renewal. We have some money (approximately $25,000) that we can either put on the mortgage or invest or put into our RRSP. What is the best way to go? —Linda Which should Canadians prioritize: RRSP or mortgage? Most of .... More »
 retirement planning

Nicholas Hui, P.Eng, Certified Financial Planner + MORE Mar 22nd

Who is Nicholas Hui? Nicholas Hui was an automotive engineer for 20 years before becoming a Certified Financial Planner. He brings the same systematic approach from his engineering background to his practise now as an advice-only planner. Nicholas specializes in helping young families and profess.... More »
I’m decades from retirement. Do I really need to contribute to my RRSP?The biggest issue with contributing to an RRSP too early is the need down the road to withdraw the money for expenses other than retirement that come along, says experts

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I am looking to use my RRSP to buy a vacation property in Portugal. How much can I take out tax free?—Andy

Tax implications of buying property in another country

I think you are referring to the Home Buyers’ Plan (HBP), Andy, when you ask about a tax-free registered retirement savings plan (RRSP) withdrawal. The HBP allows a tax-free withdrawal from your RRSP if you are a first-time home buyer purchasing an eligible home. HBP participants can withdraw up to $35,000, as can their spouse or common-law partner, for a total of $70,000.

You are considered a first-time home buyer if neither you nor your spouse or common-law partner owned a home that you occupied in the current year or the four previous years. However, in order for a property to be considered a qualifying home, it must be located in Canada. So, your Portuguese vacation property is not going to qualify for the HBP.

If you were to withdraw from your RRSP to buy this property, Andy, the withdrawal would be added to your other income for the year and be fully taxable…

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