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rgocs posted:Does it have to be a specific type of RRSP account? Yes. You open an actual Spousal RRSP. The annuitant is the lower income spouse who will declare the income upon withdrawal. The contributor is the higher income spouse who will take the deduction. You can't just use any RRSP to implement this strategy.
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# ? Aug 9, 2018 23:38 |
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# ? May 30, 2024 13:51 |
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Kal Torak posted:Yes. You open an actual Spousal RRSP. The annuitant is the lower income spouse who will declare the income upon withdrawal. The contributor is the higher income spouse who will take the deduction. Yep. And crucially the annuitant = the account opener. This is the part I hosed up. Investorline was pretty good about it though - instantly reversed the contribution. But I need to close that account now after going through the song and dance of opening it and open a new one in my wife’s name instead.
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# ? Aug 10, 2018 05:37 |
Cool, thanks guys!
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# ? Aug 10, 2018 05:49 |
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I was thinking the other day about TFSAs, and if, in the case where you have non-registered investments and TFSA investments, if there is ever any scenario where it makes sense to withdrawl everything in the TFSA into cash, wait until you can contribute again, and move a bunch of your registered investments into the TFSA. Of course when you move a registered investment into a TFSA you pay capital gains tax on this, so it seems like there'd be no point to doing this if the equity in the TFSA you were selling was the same as the equity you were moving into the TFSA. The same effect would be had if one just sold their unregistered equity. (eg. Huzzah I sold 100 shares of MSFT for a big tax free gain, now to move 100 shares of MSFT into my TFSA... oops I have to pay capital gains tax). So the only scenario I can think where it makes sense is: Your marginal tax rate is (temporarily?) low and you expect it to go higher in the future. Say you're travelling around the world for a year and you're going to have near zero income. Would it make sense to clear out your TFSA, and then refill it from the sale of unregistered equities at a very low marginal tax rate? Does this make any sense? Can anyone think of another situation? I mean other than "I need money now for a down payment on a house so I need to clear out my TFSA."
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# ? Aug 11, 2018 20:46 |
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Femtosecond posted:I was thinking the other day about TFSAs, and if, in the case where you have non-registered investments and TFSA investments, if there is ever any scenario where it makes sense to withdrawl everything in the TFSA into cash, wait until you can contribute again, and move a bunch of your registered investments into the TFSA. If your tax rate is temporarily low and you need money why not just take it out of your RRSP? If you don't think your tax rate will ever be as low then there's no better time. Same for the travelling around the world. RRSP isn't strictly for retirement, taking money out whenever your tax rate is at it's nadir and you need income is good practice. TFSA on the other hand is much better to just leave untouched until retirement, as you'll get the maximum compounding tax-free return the longer you leave your investments in there.
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# ? Aug 11, 2018 20:54 |
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If you had a TFSA, RRSP, and unregistered accounts would you go equities/growth 100% in TFSA?
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# ? Aug 11, 2018 21:59 |
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Square Peg posted:If your tax rate is temporarily low and you need money why not just take it out of your RRSP? If you don't think your tax rate will ever be as low then there's no better time. I thought you lose the contribution room from your RRSP permanently, whereas with TFSA you can re-contribute later. Am I misunderstanding? That would make withdrawing from your RRSP way worse.
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# ? Aug 11, 2018 23:01 |
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Trillian posted:I thought you lose the contribution room from your RRSP permanently, whereas with TFSA you can re-contribute later. Am I misunderstanding? That would make withdrawing from your RRSP way worse. The RRSP is more of a deferred tax mechanism, so you’re not “losing contribution room” in the same way. If you have really low taxes one year then it probably makes sense to withdraw some of it. (I’ve never looked into this so please don’t do that just cause I said it seemed like a good idea.)
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# ? Aug 11, 2018 23:27 |
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cowofwar posted:If you had a TFSA, RRSP, and unregistered accounts would you go equities/growth 100% in TFSA? Depends on timeframe, if you lose money inside a TFSA it sucks hard as you don't get more contribution room due to losses so that room is gone forever. So if you're needing to pull money out of the TFSA in the next 5-10 years then full equity can be risky. Also, interest from bonds is taxed at your full rate (vs dividends which are taxed at a lower rate), so it might make sense to stuff them in registered accounts. I think it depends a lot on your situation, but as a young guy who won't be retiring for a long while, I personally try to keep my income/bonds in my RRSP, fill my TFSA with equity (especially international equity), and keep Canadian equity in my unregistered. However, keeping a proper balance should always be a higher priority than any tax advantages.
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# ? Aug 12, 2018 00:05 |
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I cleared out my TFSA because it was unduly exposed to the US market and I have no faith in this quite historically absurd global bull bubble sustaining itself past the midterms. Cash at 2% is safer for the next few months IMO.
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# ? Aug 12, 2018 01:10 |
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Timing the market is hard. I’m sure people thought it was a good time to sell before Trump was elected.
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# ? Aug 12, 2018 01:36 |
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Evis posted:The RRSP is more of a deferred tax mechanism, so you’re not “losing contribution room” in the same way. If you have really low taxes one year then it probably makes sense to withdraw some of it. (I’ve never looked into this so please don’t do that just cause I said it seemed like a good idea.)
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# ? Aug 12, 2018 01:43 |
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They’re tax sheltered until you withdraw so I don’t think it’s as simple as it being good or bad. I think there are situations where it is a good idea. The year off to travel or study or whatever is what I’m thinking, where you take the money out of the RRSP and then put it in a TFSA. In that scenario the future earnings are really tax sheltered. If you put it into an unregistered account I guess it’s much more complicated and you’d have to know future earnings to know if it made sense or not.
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# ? Aug 12, 2018 01:50 |
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That's true, I just think people should very much consider what they're doing when they're withdrawing earlier than retirement since you're giving up a huge amount of potential. Additionally it's usually a horror story of bad financial decisions when someone's withdrawing early but maybe that's just my bias from reading Reddit PRC drama
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# ? Aug 12, 2018 02:48 |
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Less Fat Luke posted:I don't think that's really a good plan; the gains and dividends inside your RRSP are also tax sheltered and interrupting that potential compounding before you have to is not a great strategy IMHO. Well, the scenario is needing money and the choice of taking money out of either an RRSP or a TFSA. If you have the funds you need in an unregistered account, you should certainly use those first.
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# ? Aug 12, 2018 02:50 |
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Daily reminder that TFSA and RRSP have the same benefit in the same tax bracket. If you cash out in a lower tax bracket you can come out ahead comparatively, but it works the other way too. Outside of edge cases, withdrawing first from unregistered accounts would likely be best as a general rule.
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# ? Aug 12, 2018 03:12 |
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Square Peg posted:Well, the scenario is needing money and the choice of taking money out of either an RRSP or a TFSA. If you have the funds you need in an unregistered account, you should certainly use those first.
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# ? Aug 12, 2018 03:42 |
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Femtosecond posted:I was thinking the other day about TFSAs, and if, in the case where you have non-registered investments and TFSA investments, if there is ever any scenario where it makes sense to withdrawl everything in the TFSA into cash, wait until you can contribute again, and move a bunch of your registered investments into the TFSA. Realizing capital gains in a low income year is a normal thing to do. You can then immediately re-purchase similar investments (though not too similar, there are rules about this) at a new, higher, cost basis. But if tax saving is all you're trying to accomplish there's no need to bring your registered investments into the picture. Re-balancing your assets between unregistered and registered accounts is also something that you'd potentially need to do if you change your overall investment plan. Since that involves realizing capital gains, it makes sense to do it in a low income year if you're going to it. Kreez fucked around with this message at 05:07 on Aug 12, 2018 |
# ? Aug 12, 2018 05:03 |
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Honestly just any time you're making a dramatic decision when it comes to financial strategy you should be like 'whoa this move is really uncommonly advantageous by people who know what they're doing so I should really examine it from a few different perspectives' and if you arrive at the decision that you're trying to time the market you should immediately turn off your computer and find someone else to consult about this stuff. Like anything else, financial advice falls into hyperbolic echo chamber nonsense constantly and if you're in some non-SA subforum with a bunch of people who are halfway through their first year accounting courses and have Very Strong Opinions you're only going to get the worst flavor of the month advice possible.
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# ? Aug 12, 2018 05:12 |
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Globe and Mail posted:Wealthsimple Inc., Canada’s largest robo-adviser, is infiltrating the discount brokerage business with the launch of a new trading platform that will allow investors to buy, sell and track stocks and exchange-traded funds with zero trading commissions. Seems like it will launch with a few catches: only unregistered accounts and mobile-only. The FAQ also indicates they will charge for some "premium" features but don't specify what those will be. In other low/no-fee Canadian investment news: CBC posted:A David and a Goliath have shaken up the investment industry this month with new investment products that take the growing trend of low-fee investing one step further and charge no fees at all. Details from Fidelity.
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# ? Aug 18, 2018 15:29 |
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I moved to the US a few months ago, and I still have a fair amount of savings sitting in my Canadian savings account doing nothing. I don't have a non-registered investment account, but I do have RRSP contribution room. I'm thinking I should invest that money in my RRSP instead. Because I've only worked 4 months in Canada this year, I won't have enough Canadian income to justify claiming the RRSP deduction. But when I come back, I expect to have a large enough salary to benefit from RRSP deductions. Are there any restrictions for non-residents that I'm not aware of? Even if I'm no longer a resident for tax purposes, can I still contribute to my RRSP?
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# ? Aug 19, 2018 20:21 |
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My Transunion score dropped from 808 to 792 between July and August, and I can't figure out why that is. I didn't take out or apply for any new credit products or miss any payments on anything, or even put anything on the existing line of credit. The only credit-related event that I can think of was that I had to replace a credit card that was compromised. Is there any way to debug that sort of thing? I"m not alarmed really, but I'm pretty curious.
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# ? Aug 21, 2018 17:11 |
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# ? Aug 21, 2018 17:33 |
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Subjunctive posted:My Transunion score dropped from 808 to 792 between July and August, and I can't figure out why that is. I didn't take out or apply for any new credit products or miss any payments on anything, or even put anything on the existing line of credit. The only credit-related event that I can think of was that I had to replace a credit card that was compromised. I think mostly no, but other factors include use of credit available, ie your balances when they were reported which will fluctuate month to month. Also last payment - I have a few idle cards and LOCs and my scores jump/fall a tiny bit depending on how recently I've made a payment on them all. From your description, maybe your last use of (payment to) the LOC was long enough ago to cross a threshold a cost a few points. But maybe an old closed account aged out of relevance so your average account age fell.
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# ? Aug 21, 2018 17:49 |
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This was the free monthly reporting via CreditKarma, which I don’t think causes a hit. I sure hope not. James Baud posted:I think mostly no, but other factors include use of credit available, ie your balances when they were reported which will fluctuate month to month. Also last payment - I have a few idle cards and LOCs and my scores jump/fall a tiny bit depending on how recently I've made a payment on them all. Interesting. The LoC payment was fine, but maybe something did age out. I hadn’t thought of that. Thanks for the thoughts. I’ll see what happens in September.
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# ? Aug 21, 2018 17:58 |
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Dude don’t worry about it.
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# ? Aug 21, 2018 19:46 |
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Subjunctive posted:This was the free monthly reporting via CreditKarma, which I don’t think causes a hit. I sure hope not. I signed up with Borrowell who shows a readout of your transunion report on their site while trying to offer you payday loans. If you ignore the payday loans, you can get free online monthly refreshes of the transunion score and report.
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# ? Aug 21, 2018 20:35 |
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Lexicon posted:Dude don’t worry about it. I said I wasn’t alarmed, just curious.
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# ? Aug 21, 2018 20:37 |
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Risky Bisquick posted:I signed up with Borrowell who shows a readout of your transunion report on their site while trying to offer you payday loans. If you ignore the payday loans, you can get free online monthly refreshes of the transunion score and report. Borrowell uses Equifax, not Transunion. Credit Karma uses Transunion.
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# ? Aug 21, 2018 20:44 |
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Kal Torak posted:Borrowell uses Equifax, not Transunion. oops
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# ? Aug 21, 2018 20:46 |
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RRSP employee match question. My wife has her employee other employee contribution match for RRSP up to $1000 a year. Her choice in mutual funds are terrible though, as the balanced portfolio's MER is 2.52% !!!!!!! Right now she is only contributing 2k a year in this fund, but long term how should we handle this? Invest in a low fee fund outside of work and ignore the employer match? Or is there somehow to transfer the cash out of the work RRSP to a private one?
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# ? Aug 27, 2018 21:15 |
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zapplez posted:RRSP employee match question. Get her to contact her benefits rep and find out about her transfer options. My last job let me do it once a year but I think there was a fee involved. Annoying, but worth it for the free money from the match. She might want to mention some of the rationale to the benefits person, as they might not consider the MER of the RRSP options when selecting a provider.
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# ? Aug 27, 2018 23:12 |
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Or see if the platform your employer chose for employee matching has an option to let you pick and choose where your money goes. My matching program is with Desjardins and it can be as DIY as I want.
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# ? Aug 28, 2018 00:11 |
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I'm also dealing with this right now, but I'm pretty sure my work let's me do a transfer once a year. I was elated when I looked up the balanced and diversified fund my contribution is going to has an MER of only 0.11%! But then noticed that on top of that the institution was charging me 0.5% every quarter. Hopefully it doesn't cost anything to get it over to my Questrade.
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# ? Aug 28, 2018 05:15 |
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is it recommendable to go to my bank for a financial advisor regarding my pension plan? i just need some help understanding what i should do. i'm transferring my contributions under a different pension plan (previous job) to my current one and there's a shortfall. i think it's best if i accept the transfer and pay the shortfall. anyway, i need someone to talk to.
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# ? Sep 4, 2018 22:04 |
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Post it here. Round off or change the numbers if you like. Someone will have reckons.
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# ? Sep 5, 2018 03:53 |
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Yes post it here. Nobody at the bank will give a poo poo, and in all likelihood cannot legally help you even if they wanted to.
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# ? Sep 5, 2018 06:01 |
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Skizzzer posted:is it recommendable to go to my bank for a financial advisor regarding my pension plan? i just need some help understanding what i should do. i'm transferring my contributions under a different pension plan (previous job) to my current one and there's a shortfall. i think it's best if i accept the transfer and pay the shortfall. anyway, i need someone to talk to. Your pension plan and/or union should have someone that will meet with your to discuss your options. If they don't or you need more complicated estate planning advice, you need to seek out an independent, fee based financial adviser. The salesman at the big 4 banks will just try and sell you GICs and 2% MER mutual funds and have no practical plans on how to best handle or commute a pension.
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# ? Sep 8, 2018 12:47 |
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Or
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# ? Sep 8, 2018 21:07 |
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# ? May 30, 2024 13:51 |
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Someone I know mentioned that dentists often refuse to open on Fridays because the way that they are taxed as a business means they would lose money were they pushed into the next tax bracket and cited business taxes being different than personel when I asked about the first $x being taxed at one rate with the remainder taxed at another. This sounds like it’s wrong, and I haven’t found any evidence of this in the brief research that I’ve done. Is there any truth to it? It feels like some sort of anti tax rhetoric.
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# ? Sep 20, 2018 14:10 |