Comments on: Setting up an RRSP for the first time http://www.moneysense.ca/2013/01/22/setting-up-an-rrsp-for-the-first-time/ Canada's Personal Finance Website Wed, 19 Jun 2013 23:09:34 +0000 hourly 1 http://wordpress.org/?v=3.0.5 By: Mic D'angelo http://www.moneysense.ca/2013/01/22/setting-up-an-rrsp-for-the-first-time/comment-page-1/#comment-606048 Mic D'angelo Wed, 08 May 2013 21:18:45 +0000 http://www.moneysense.ca/?p=39965#comment-606048 If you have all or 60% to 70% of your investments in your RRSP's and you need money for a big expense say $30,000 you would have to take out between $45,000 to $50,000 depending on your income tax bracket. I think RRSP's should not be maximum 25% to 35% of a person's total financial assets and investments. A $700,000 total portfolio should have maximum between $175,000 to $245,000 in RRSP's.If you have a higher percentage than this you could gradually withdraw sooner smaller amounts to minimize taxes over more years.For example,Instead of withdrawing a large lump sum when you are desperate and pay alot of income taxes withdraw the $30,000 in 2 years and put it in a TFSA to avoid future income taxes if possible.If you already maxed out your TFSA put it in a non-registered account. If you have all or 60% to 70% of your investments in your RRSP's and you need money for a big expense say $30,000 you would have to take out between $45,000 to $50,000 depending on your income tax bracket.
I think RRSP's should not be maximum 25% to 35% of a person's total financial assets and investments.

A $700,000 total portfolio should have maximum between $175,000 to $245,000 in RRSP's.If you have a higher percentage than this you could gradually withdraw sooner smaller amounts to minimize taxes over more years.For example,Instead of withdrawing a large lump sum when you are desperate and pay alot of income taxes withdraw the $30,000 in 2 years and put it in a TFSA to avoid future income taxes if possible.If you already maxed out your TFSA put it in a non-registered account.

]]> By: headshots http://www.moneysense.ca/2013/01/22/setting-up-an-rrsp-for-the-first-time/comment-page-1/#comment-600321 headshots Sat, 13 Apr 2013 00:35:37 +0000 http://www.moneysense.ca/?p=39965#comment-600321 There's always people interested in RRSP's that show up at the local branch of their financial institution within days of deadline! There's always people interested in RRSP's that show up at the local branch of their financial institution within days of deadline!

]]> By: blogger countdown http://www.moneysense.ca/2013/01/22/setting-up-an-rrsp-for-the-first-time/comment-page-1/#comment-599435 blogger countdown Tue, 09 Apr 2013 08:44:46 +0000 http://www.moneysense.ca/?p=39965#comment-599435 Actually i came here while searching on google for that term and its just awesome article. i like it and share it to my fans. So I like to tell you that your 4th point is most powerful then any other. appreciate it Actually i came here while searching on google for that term and its just awesome article. i like it and share it to my fans. So I like to tell you that your 4th point is most powerful then any other. appreciate it

]]> By: Stephane http://www.moneysense.ca/2013/01/22/setting-up-an-rrsp-for-the-first-time/comment-page-1/#comment-585618 Stephane Tue, 26 Feb 2013 04:37:42 +0000 http://www.moneysense.ca/?p=39965#comment-585618 The author says it is possible to put too much money in RRSP. What would be the criteria to determine if too much is invested in RRSP? The author says it is possible to put too much money in RRSP. What would be the criteria to determine if too much is invested in RRSP?

]]> By: Mic D'angelo http://www.moneysense.ca/2013/01/22/setting-up-an-rrsp-for-the-first-time/comment-page-1/#comment-578800 Mic D'angelo Fri, 25 Jan 2013 08:59:49 +0000 http://www.moneysense.ca/?p=39965#comment-578800 I think the best strategy is make an RRSP contribution as much as you can and take the tax refund and contribute to your TFSA.Make an RRSP contribution $5,000 a year and invest in long term provincial strip bonds at 3.65% for 35 years(30 to 65 years old). The RRSP will be worth $343,413.55 at age 65. The TFSA will be worth $106,458.20 at age 65 with $1,550 per TFSA contributions($5,000*31*=$1,550). If you don't want the tax refund and want all your investments tax free it would be worth $343,413.55 at age 65 in your TFSA. If a couple did the maximum TFSA of $5,500 a year and say $5,500 RRSP contribution they would have $755,509.81 in RRSP's and $755,509.81 in TFSA's a balanced 50% taxable/ tax free income. The couple would have to save $9,295.00*2=$18,590 a year not $22,000 because the $3,410 less is annual tax refunds. The couple would have $1,511,019.62 in total RRSP's, TFSA's. I think the best strategy is make an RRSP contribution as much as you can and take the tax refund and contribute to your TFSA.Make an RRSP contribution $5,000 a year and invest in long term provincial strip bonds at 3.65% for 35 years(30 to 65 years old). The RRSP will be worth $343,413.55 at age 65. The TFSA will be worth $106,458.20 at age 65 with $1,550 per TFSA contributions($5,000*31*=$1,550). If you don't want the tax refund and want all your investments tax free it would be worth $343,413.55 at age 65 in your TFSA. If a couple did the maximum TFSA of $5,500 a year and say $5,500 RRSP contribution they would have $755,509.81 in RRSP's and $755,509.81 in TFSA's a balanced 50% taxable/ tax free income. The couple would have to save $9,295.00*2=$18,590 a year not $22,000 because the $3,410 less is annual tax refunds. The couple would have $1,511,019.62 in total RRSP's, TFSA's.

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