Get money out of your RRSP tax-free

Open a RRIF before age 71 to get a big tax break

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Deposit your RRIF withdrawal into your RRSP for more savings.

5 comments on “Get money out of your RRSP tax-free

  1. Probably good tips, but it sounds so complicated!! Anyway I'm only 40 now so I probably don't need to be worried about it now.

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  2. Contributing to Childs RSP talks about TFSA not RSP ?? Da

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  3. I agree that for many retired people, withdrawing RRSP $$ before you have to, to create pension income in order to make use of the pension income credit , is a good idea, as long as the subsequent income earned on that $$ is taxed at very low rates. — Taxes on w/d are cancelled out by the pension income credit.

    But the idea to re-contribute back into the RRSP is bogus. It would put you back exactly where you started from. Either your $$ is better off inside, or outside, the plan. If it is better off inside the plan, don't do anything. If it is better off outside then take it out and leave it out. Use this spreadsheet http://www.retailinvestor.org/OutorIn.xls The first tax rate variable would be 0% .

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  4. The idea to re-contribute back into the RRSP is bogus. It would put you back exactly where you started from. Either your $$ is better off inside, or outside, the plan. If it is better off inside the plan, don't do anything. If it is better off outside then take it out and leave it out. Use this spreadsheet http://www.retailinvestor.org/OutorIn.xls The first tax rate variable would be 0% .

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  5. In case any readers think you would NOT be in the same position because you would have received another RRSP contribution credit ….. you need to understand that the tax credit is not a benefit or of value. It is a loan. See http://www.retailinvestor.org/RRSPmodel.html for detailed argument.

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