Ways to “unlock” retirement savings in a LIRA + MORE Dec 7th

How to go about securing the best Retirement Plan in Canada.
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What happens at the end of a reverse mortgage? Mar 9th

When you get a reverse mortgage, you tap the equity in your home without having to sell it. There are several advantages to having a reverse mortgage, for those who qualify: For one, you gain access to part of the cash value of your home, increasing your liquidity. Setup and legal fees are rolled in.... 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 »
 retirement planning

When are tax-deferred and tax-free accounts actually taxable? + MORE Feb 9th

Q. I saw your blog online; thank you so much for the wonderful job that you are doing—it was very informative! That motivated me to start investing too, but now I have a couple of questions. I understand that there is tax on US dividends in TFSA, do we pay tax as well when we sell: U.S. stocks in.... More »
 freedom 55

How much has the pandemic hurt your retirement plans? We delve into the retirement portfolios of two couples hit hard by COVID-19 to see what damage was done + MORE Feb 16th

We start with Deborah and Daryl Burton, a Toronto twosome in their early 70s who both contracted COVID-19 early in the pandemic..... More »

Downsizing vs reverse mortgage: which option is right for you? Feb 2nd

For many Canadians approaching retirement, their home is by far their largest asset. With detached homes in major cities selling for well above $1 million, it’s not surprising that owners expect to tap into that equity to help fund their golden years, prompting the common refrain: “My home is my.... More »
The latest headlines tell a now-familiar story: Canadian households’ debt loads have increased once again, with the debt-to-income ratio hitting 175.4% in the first quarter of 2020. But what is this ratio, why is it rising, and—most importantly—do you need to worry about it? 
What is the debt-to-income ratio?
First things first. The debt-to-income ratio is a measure of how much debt a household is carrying, relative to its disposable income—that is, the money you have available to spend or save, after taxes and other non-discretionary expenses, such as EI and CPP or QPP contributions, are made. 
A ratio of 175,4% means that, across all Canadian households, in the first three months of 2020 we collectively owed $1.75 for every dollar of disposable income we have. That’s very close to the all-time high of 179% in late 2017.
In September 2020, Statistics Canada reported that household indebtedness fell as a result of changing spending, saving and borrowing patterns during the global COVID-19 pandemic…

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Q. When I retired at age 63, the financial institution that managed my DPSP account paid the company-contributed portion (approximately $30,000) into a LIRA. 
Given all the constraints related to drawing down a LIRA/LIF, I am now 65, living in BC, and have two questions:

Since I was already at retirement age, was it really necessary for the financial institution to create the LIRA, or could all the proceeds simply have been consolidated into my RRSP account?
In order to simplify the management of my portfolio, is there any way of “unlocking” the LIRA so that I can place the proceeds into a normal RRIF?

A. Leaving a group pension or retirement savings plan often means you have decisions to make. Some plans allow retirees to keep their investments with the provider, either in the same plan or with their retiree program. 
Plan members often transfer their investments out to invest with an advisor or on their own. Certain accounts need to be transferred to new accounts, while others can be transferred to the same receiving account…

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