Can I limit the amount of taxes I pay when I withdraw from my savings? Yes, you can! Find out about the best withdrawal strategies. Discuss it with your SSQ financial security advisor.
Many retirees hesitate to withdraw their registered investments for a number of reasons.
1. Hard habit to break
We spend a lifetime saving our money and now we are required do the opposite. But isn’t that precisely why you saved the money in the first place?
2. Personal values
We wish to leave our children an inheritance. But will they need it? How old will they be after their parents die…55?
3. The fear of “not having enough” later
Performing an income projection is simple and allows you to maintain an adequate lifestyle by factoring in projected inflation and RRSP returns.
Cashing your money wisely
Bottom line: It’s better to withdraw from non-registered investments before registered investments (RRSP, TFSA, LIF1, RRIF2). As long as you don’t withdraw from registered investments, they will grow tax-free.
If you believe that, at age 65, you may be eligible to benefit from the guaranteed income supplement under the federal Old Age Security pension, it would not be to your advantage to withdraw from your RRSP after age 65.
However, when you contribute to a private pension plan (RREGOP, PPMP), you’re in a higher tax bracket and cannot access this additional benefit.
Withdrawing registered investments hastily in an attempt to save on taxes is not a sound strategy. Subject to the conditions that apply, it is better to pay taxes later rather than sooner.
In short, planning the financial aspect as early as possible is definitely the way to ensure that your retirement is everything you dreamed it would be.
To do so with an SSQ Insurance financial security advisor, call 1 866 225-5050.
1. Locked-in Retirement Account
2. Registered Retirement Income Fund
This document is intended for information purposes only and should not be construed as legal, financial, tax or other advice. The circumstances or factors may vary depending on your individual situation. Before taking action, we encourage you to consult a professional. SSQ Insurance may not be held responsible for any consequences arising from any decision taken based on the content presented in this document.
*Beneva designates Beneva Inc., Financial Services Firm.
Note: This document is provided for information purposes only. Under any circumstances, it should not be considered as financial, legal or tax advice. For advice on your personal situation, speak to your advisor. Beneva Inc. cannot be held responsible for any decision made as a result of reading this blog post.
Life, health and accident insurance, and investment and retirement products are offered by Beneva and are distributed by the financial security advisors of Beneva Inc., Financial Services Firm.