The way I see it, Canadian’s are not taking full advantage of their entitlements to create a comfortable and secure retirement. How are you supposed to have your dream retirement if you don’t plan for it?
I am a firm believer that you should have multiple streams of income throughout your lifetime, including retirement, as well as multiple strategies working hard for you to reach your retirement goals. This multiplicity brings in an era of complexity, so it is also important to have a Certified Financial Planner on your side, to help ensure the Canadian Government is not the primary beneficiary of your estate.
Here are 6 streams of income, or accounts, that can help you to properly diversify your future:
- Pensions – Whether you have an employment or governmental pension, or both, you will have to pay taxes while living, but no taxes upon death.
- Registered Investments – RRSPs and RRIFs (after age 71), must mature by age 71 and then withdrawals are taxable (hopefully at a lower tax rate), unless there is a spousal rollover.
- Tax-Free Savings – Always a good option to supplement RRSPs or even instead of if funding is an issue. There is no taxation at death.
- Non-registered Savings – Interest-earning investments are fully taxed as interest is received. Eligible dividends, which are taxed at approximately 66 per cent of their value in the year in which they are earned. Capital gains on investments, which are taxed up to 50 per cent of their value, (may be deferred until the investments are disposed). Non-registered investments may be subject to probate and other estate fees upon death.
- Investment Property +/- Primary Residence – Investment properties may be subject to capital gains tax when sold or as a deemed disposition upon death unless spousal/other rollovers. Primary residence is non-taxable upon sale or death.
- Tax-Exempt Insurance – Limited tax-exempt life insurance policies, (for example, Participating Whole Life). Great tool for asset accumulation and wealth preservation. Adds diversification to your investment portfolio and provides tax-exempt growth over your lifetime. Tax-free death benefit. Bypasses probate if beneficiary is named.
If you are looking to diversify your income for your future, and keeping your named beneficiaries as your primary beneficiaries, I can help. You can set up a complimentary, 30 – minute phone consultation at https://calendly.com/mjhfinancial/30min OR email me at michael@mjhfinancial.ca.
P.S. Why not meet with a financial planner to help you create your most comfortable and secure retirement? Who doesn’t want peace of mind for their future?