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Here’s what’s changed — and what hasn’t — in a pandemic RRSP season + MORE Jan 19th
If you’ve been earning a good salary from a secure job, investing your savings in a tax-advantaged RRSP is a good idea. But if your income has suffered or your job security is uncertain, keeping what money you have saved in a TFSA is a better bet..... More »
Scammers want your retirement—here’s how to protect yourself + MORE Mar 21st
Here’s something worth knowing if you’re over 55: scammers are coming for you. Just in time for Fraud Prevention Month, new research from Blood Finance and Angus Reid confirms that fraudsters target people in this age group. Case in point: 87% of people in this age bracket reported recei.... More »
Can you receive a government pension if you live outside of Canada? Jul 20th
Q. My father, who was born in 1945, left Canada to live in Thailand when was 26 years old. That was 50 years ago and he has never returned. If he comes back to Canada for one year to apply for his OAS, would he be eligible to receive a full pension? And would they be able to calculate his pension an.... More »
Is AI the ultimate retirement hack? Jun 13th
There’s an interesting new book just published called I Am Not a Robot: My Year Using AI to Do (Almost) Everything. The author is Joanna Stern, who was a personal technology columnist for the Wall Street Journal for 12 years. As the subtitle of her book reveals, she spent a year using ar.... More »
Maximizing spousal RRSP contributions in your 70s + MORE Mar 23rd
Q. My wife will turn 71 in 2022. She has three spousal RRSPs that we will arrange to mature on the same day: Feb. 8, 2022. On that day, we will convert all the RRSPs into a RRIF.
Between now and then, I wish to take full advantage of my ability to continue making contributions to spousal RRSPs. I am.... More »
Winding down self-employment and planning for retirement
– moneysense.ca
Q. I am a 60-year-old female, working full-time employed/self employed on a 100% commission basis and averaging between $107,000 and $140,000 gross annual income.
I own my home, with a $70,000 balance left on my mortgage. My mortgage payment (not including property taxes) is $457 biweekly. The current market value of my home is about $325,000.
In terms of investments, I have $39,000 in two RRSPs (current employer plan and a small amount from a prior employer), plus about $250,000 in RRSPs with my bank.
I have no TFSA.
I would like to retire at 63, or at least reduce my work hours, and I have no idea if either is possible. I can work as long as I like, even past 65 if I choose. I recently started taking Fridays off but keeping my production the same, with no decrease in earnings. I am considering reducing to three days this fall, and continuing with that schedule until I retire.
While I’ve considered downsizing, I’m not really ready to sell my home: I love outdoor space and my pool, and I’ve redone the entire house over the last 17 years…
I own my home, with a $70,000 balance left on my mortgage. My mortgage payment (not including property taxes) is $457 biweekly. The current market value of my home is about $325,000.
In terms of investments, I have $39,000 in two RRSPs (current employer plan and a small amount from a prior employer), plus about $250,000 in RRSPs with my bank.
I have no TFSA.
I would like to retire at 63, or at least reduce my work hours, and I have no idea if either is possible. I can work as long as I like, even past 65 if I choose. I recently started taking Fridays off but keeping my production the same, with no decrease in earnings. I am considering reducing to three days this fall, and continuing with that schedule until I retire.
While I’ve considered downsizing, I’m not really ready to sell my home: I love outdoor space and my pool, and I’ve redone the entire house over the last 17 years…
Q. I received a small settlement for an Ontario car accident, which my lawyer says is non-taxable, and so noT4A will be issued. If I deposit the funds into a bank account, will this one-time settlement clawback my OAS and GIS benefits?
–J
A. I’m sorry to hear about your accident, J. Hopefully the settlement is reasonable.
You mention that your lawyer said a T4A slip will not be issued for the settlement. A T4A tax slip is used to report pension, retirement, annuity and other income. As a rule, I would suggest caution about relying on the lack of a T4A slip as being evidence that an amount is not taxable. For example, self-employed commissions paid to an independent agent should be reported on a T4A slip, but are often not reported—although self-employment income is, of course, taxable. Whether an amount is deposited to a bank account does not impact its taxation, either (for example, cash paid for taxable employment or self-employment).
I am currently dealing with a major Canadian insurance company that incorrectly issued a T4A slip for a client and they have to date refused to change it…
–J
A. I’m sorry to hear about your accident, J. Hopefully the settlement is reasonable.
You mention that your lawyer said a T4A slip will not be issued for the settlement. A T4A tax slip is used to report pension, retirement, annuity and other income. As a rule, I would suggest caution about relying on the lack of a T4A slip as being evidence that an amount is not taxable. For example, self-employed commissions paid to an independent agent should be reported on a T4A slip, but are often not reported—although self-employment income is, of course, taxable. Whether an amount is deposited to a bank account does not impact its taxation, either (for example, cash paid for taxable employment or self-employment).
I am currently dealing with a major Canadian insurance company that incorrectly issued a T4A slip for a client and they have to date refused to change it…
