BOC Hits 5% | Page 25 | GTAMotorcycle.com

BOC Hits 5%

My brother's pension will be 60% of his highest average salary, indexed every year for inflation. He doesn't contribute to his RSP at all, only to his TFSA and mortgage. By the time he retires, he wont' need the RSP money, because anything he would have withdrawn would have been taxed heavily anyways after considering his other income (pension, CPP, and OAS). Must be nice.
 
Relax said:
My brother's pension will be 60% of his highest average salary, indexed every year for inflation. He doesn't contribute to his RSP at all, only to his TFSA and mortgage. By the time he retires, he wont' need the RSP money, because anything he would have withdrawn would have been taxed heavily anyways after considering his other income (pension, CPP, and OAS). Must be nice.
Click to expand...
That’s about what mine will be also. -2% for each year I don’t get to the maximum.

I’m expecting approx 50% of my best year so should be around the 60-80k mark per year upon retirement.
 
mimico_polak said:
That’s about what mine will be also. -2% for each year I don’t get to the maximum.

I’m expecting approx 50% of my best year so should be around the 60-80k mark per year upon retirement.
Click to expand...
Just curious. Does that get reduced once you start collecting CPP? Or is CPP on top of your Omers pension?
 
AllistonGT said:
Just curious. Does that get reduced once you start collecting CPP? Or is CPP on top of your Omers pension?
Click to expand...
My understanding is they’re independent.

EDIT: now you got me curious. It appears to be combined with ‘bridge benefits’ if I take CPP early. Seems that combined they equal the full pension, but if I take CPP early then OMERS ‘bridges’ the lower CPP until it’s full.

Honestly it’s such a convoluted benefit (intentionally I assume).

But…if I die my wife gets a % of my pension, and we can apparently income split the pension between us up to a 50% split to lower taxable income.
 
Last edited:
mimico_polak said:
My understanding is they’re independent.

EDIT: now you got me curious. It appears to be combined with ‘bridge benefits’ if I take CPP early. Seems that combined they equal the full pension, but if I take CPP early then OMERS ‘bridges’ the lower CPP until it’s full.

Honestly it’s such a convoluted benefit (intentionally I assume).

But…if I die my wife gets a % of my pension, and we can apparently income split the pension between us up to a 50% split to lower taxable income.
Click to expand...
That's basically what I thought. I believe the Teachers pension bridges till 65 years and is then reduced once CPP starts being collected.
Everyone can income split after 65.
 
AllistonGT said:
That's basically what I thought. I believe the Teachers pension bridges till 65 years and is then reduced once CPP starts being collected.
Everyone can income split after 65.
Click to expand...
I’ll be honest I don’t give it much thought, but at 43 I probably should.
 
AllistonGT said:
…
Everyone can income split after 65.
Click to expand...
Couples can split some qualifying pension.

You can’t split income from OAS,CPP, or cashed out RRSP, dividend or capital gains, or any other employment related income.

You can split a registered pension plan income and RRSP only if it’s an insurance annuity, and some foreign pensions.
 
mimico_polak said:
My understanding is they’re independent.

EDIT: now you got me curious. It appears to be combined with ‘bridge benefits’ if I take CPP early. Seems that combined they equal the full pension, but if I take CPP early then OMERS ‘bridges’ the lower CPP until it’s full.

Honestly it’s such a convoluted benefit (intentionally I assume).

But…if I die my wife gets a % of my pension, and we can apparently income split the pension between us up to a 50% split to lower taxable income.
Click to expand...
Regarding survivor benefit of cpp. You are entitled up to 60% of your spouse's cpp up to a maximum. Most people already recieve the maximum amount anyway. When my wife passed, i recieved $20 of hers. The government keeps the rest.
 
Mad Mike said:
Couples can split some qualifying pension.

You can’t split income from OAS,CPP, or cashed out RRSP, dividend or capital gains, or any other employment related income.

You can split a registered pension plan income and RRSP only if it’s an insurance annuity, and some foreign pensions.
Click to expand...
My dad was just telling me his TTC pension is atop CPP…not inclusive of it. But he’s 70 and not planning on retiring.
 
GreyGhost said:
Sort of. Return on CPP investment is crap (and that assumes it doesn't collapse prior to your withdrawal and aren't in a situation to max CPP prior to stopping working in which case your return on those mandatory contributions is minus 100%). Mandatory saving at some level is a good idea. If you contribute $X per year to a locked account, you should be able to opt out of CPP contributions.

FWIW, it is possible to avoid paying into CPP without breaking any rules but you need to keep your income off a T4. I have chosen to go that route.
Click to expand...
I think it was Wingboy that posted some time back that CPP and OAS die with a spouse.

Right now with a decent job history a husband and wife get about $2000 a month EACH. If one dies the other is already almost at maximum CPP so gets squat from their partners years of contributions.

$2000 X 2 = $4000 which will pay for a modest apartment, basic food and little else.

$2000 X 1 = $2000 which gets a person a room and bus fare to the food bank.

There are other adders like Guaranteed Income Supplement etc but unlike CPP, investments outside the government are inherited by the surviving spouse or other designated heirs.
 
mimico_polak said:
My employer matches it dollar for dollar.
Click to expand...
Smokin hot deal!
Brian P said:
I am of the view that it's better to own the bank than to put money in the bank.
Click to expand...
I always tell people don't buy the bank product (mutual funds) buy the bank (stock). Canadian banks have always performed well and they offer dividends as noted.
 
Scuba Steve said:
I plan on taking my cpp as soon as eligible good chance I won't make it much past 70.

Sent from the future
Click to expand...
Government has done the math. You only make out better by delaying it if you longer than average. I started asap.
 
timtune said:
Smokin hot deal!

I always tell people don't buy the bank product (mutual funds) buy the bank (stock). Canadian banks have always performed well and they offer dividends as noted.
Click to expand...
I’ve got bank stocks for TD, BMO, and RBC because I like the dividend stock. Same as Enbridge...but there’s an older stock thread somewhere out there.
 
mimico_polak said:
That’s about what mine will be also. -2% for each year I don’t get to the maximum.

I’m expecting approx 50% of my best year so should be around the 60-80k mark per year upon retirement.
Click to expand...
Closet baller, I knew it!!
 
mimico_polak said:
That’s about what mine will be also. -2% for each year I don’t get to the maximum.

I’m expecting approx 50% of my best year so should be around the 60-80k mark per year upon retirement.
Click to expand...
Isn't omers based on your best five years? Sure you may not max it but if you have a really good five years, you can make bank.

Edit:

I wonder if there is a way to game the system. Something like making 50k one year and 250k the next year (bonus structuring, defer bonus for a big completion bonus etc). Should cost the same to employer. Bad for income tax for you as you pay more but if that adds 10k a year for all retirement, the lost tax will be quickly forgotten.
 
GreyGhost said:
Isn't omers based on your best five years? Sure you may not max it but if you have a really good five years, you can make bank.

Edit:

I wonder if there is a way to game the system. Something like making 50k one year and 250k the next year (bonus structuring, defer bonus for a big completion bonus etc). Should cost the same to employer. Bad for income tax for you as you pay more but if that adds 10k a year for all retirement, the lost tax will be quickly forgotten.
Click to expand...
There’s no bonus or anything as such here…the ‘gaming’ of the system is work until you get the retirement package you want, then leave, take pension, and earn as a consultant while coming back.

But that’s an MP problem 15-20 years away.
 
Mad Mike said:
Couples can split some qualifying pension.

You can’t split income from OAS,CPP, or cashed out RRSP, dividend or capital gains, or any other employment related income.

You can split a registered pension plan income and RRSP only if it’s an insurance annuity, and some foreign pensions.
Click to expand...
I didn't know all the limitations.👍
 
Mad Mike said:
Couples can split some qualifying pension.

You can’t split income from OAS,CPP, or cashed out RRSP, dividend or capital gains, or any other employment related income.

You can split a registered pension plan income and RRSP only if it’s an insurance annuity, and some foreign pensions.
Click to expand...
Looks like you can "share" CPP. Depends how long you lived with your spouse during the "joint contributory period".
I'll have to look into this further.

Income splitting opportunities for couples in retirement
 
You must log in or register to reply here.

Back
Top Bottom