Zach6668 513 Posted February 1, 2017 Author Share Posted February 1, 2017 I've been playing around with my taxes for the last week or so. I don't quite have my documents in order yet, but I was trying to figure out what kind of RRSP contribution I can make to max out my return. It's pretty remarkable. If I put in about $1739, it increases my return by like $800 or something... basically free money. I was trying to figure out where the returns start to diminish and probably contribute that much. I don't have the cash handy, but my return will be almost 2x the contribution amount so I can just borrow it from my line of credit. Nice little scam we've got going here. That's probably mostly attributable to having tuition amounts carried forward that I have to burn. I'm going to be a responsible adult and do what I should have done over a decade ago and get back to contributing to my RRSP every paycheck. I'll definitely have to accelerate it though if I ever want to retire. Lol. Link to post Share on other sites
AlbertoR 2 Posted February 1, 2017 Share Posted February 1, 2017 Just keep watching this thread .................. Link to post Share on other sites
Babying 613 Posted February 1, 2017 Share Posted February 1, 2017 RRSPs are a joke to some clients. All who are near retirement wished they did not do it. Link to post Share on other sites
Zach6668 513 Posted February 1, 2017 Author Share Posted February 1, 2017 RRSPs are a joke to some clients. All who are near retirement wished they did not do it. How do you mean? Link to post Share on other sites
Zach6668 513 Posted February 1, 2017 Author Share Posted February 1, 2017 (I have $800 unused amount carried forward, and a contribution limit of like $15,000 total) I figured out if I contributed $4000, I'd get a return of $4013... $13 might be enough to cover the interest on the month or so between taking money from my line of credit to put into my RRSP and getting my return to pay off the line of credit... but I'd end up with $1316.84 in free money. That's the turning point where my contribution stays less than my return. I think I'd rather take some cash out of my return and save for a vacation this summer, though. So I'll probably stick to the point where returns start to diminish, which is around a $950 contribution (plus the extra $800 carried forward that wouldn't go into my RRSP, but increases my return.) Link to post Share on other sites
Babying 613 Posted February 1, 2017 Share Posted February 1, 2017 How do you mean? They all have pension income. Thus when they pull their RRSPs out they will get taxed on it. No way around it. I had one client last year said she is going to take early retirement. Her house is paid off and the 2 loser sons of her actually have jobs and may move out. She was all happy with her nest egg of $700k in her RRSP. I said no you don't have that. She said what do you mean, I said you don't have it. When you withdraw it, you will get taxed. You only have $350k (estimating of course). She was near tears. Actually RRSPs are good for first time homebuyers. They can borrow $25k from their RRSPs pretty much interest free for 17 years. Link to post Share on other sites
Zach6668 513 Posted February 1, 2017 Author Share Posted February 1, 2017 They all have pension income. Thus when they pull their RRSPs out they will get taxed on it. No way around it. I had one client last year said she is going to take early retirement. Her house is paid off and the 2 loser sons of her actually have jobs and may move out. She was all happy with her nest egg of $700k in her RRSP. I said no you don't have that. She said what do you mean, I said you don't have it. When you withdraw it, you will get taxed. You only have $350k (estimating of course). She was near tears. Actually RRSPs are good for first time homebuyers. They can borrow $25k from their RRSPs pretty much interest free for 17 years. Well, she was ignorant of a fundamental aspect of RRSPs, LOL. I have a very hard time imagining I'll have much of a pension at all. Don't think that's how the world works anymore. I don't have a pension plan through work, though perhaps my directors and executives have a pension plan I don't know about. I'll have whatever CPP scraps are remaining and whatever I save for myself. I doubt I'll be in the highest tax brackets when I'm withdrawing this money. Lol. Link to post Share on other sites
Zach6668 513 Posted February 1, 2017 Author Share Posted February 1, 2017 I get a (smallish) raise starting tomorrow and have all of my high interest debt paid off, so I'm kind of trying to figure out how to adult financially again. Lol. Link to post Share on other sites
Babying 613 Posted February 1, 2017 Share Posted February 1, 2017 Well, she was ignorant of a fundamental aspect of RRSPs, LOL. I have a very hard time imagining I'll have much of a pension at all. Don't think that's how the world works anymore. I don't have a pension plan through work, though perhaps my directors and executives have a pension plan I don't know about. I'll have whatever CPP scraps are remaining and whatever I save for myself. I doubt I'll be in the highest tax brackets when I'm withdrawing this money. Lol. Why call her ignorant. She is a single mother trying to raise her 2 loser sons. She only worked to support those 2 and that was it. She was able to pay off her home as a single mother. Either way, when you do withdraw RRSPs you will get taxed. Link to post Share on other sites
Zach6668 513 Posted February 1, 2017 Author Share Posted February 1, 2017 Why call her ignorant. She is a single mother trying to raise her 2 loser sons. She only worked to support those 2 and that was it. She was able to pay off her home as a single mother. Either way, when you do withdraw RRSPs you will get taxed. Ah, that's fair. I wasn't using ignorant as a derogatory term, rather just to mean "didn't know". I looked up the definition now and it seems that it carries more weight than that. Learn something new every day. Anyways, I thought it was common knowledge that that's how RRSPs worked. The whole idea is to defer tax now, and use the money as "income" when you're presumably in a lower tax bracket. Seems unlikely that people save enough to withdraw more annually in retirement than they earned during the prime of their careers. Link to post Share on other sites
Babying 613 Posted February 1, 2017 Share Posted February 1, 2017 Ah, that's fair. I wasn't using ignorant as a derogatory term, rather just to mean "didn't know". I looked up the definition now and it seems that it carries more weight than that. Learn something new every day. Anyways, I thought it was common knowledge that that's how RRSPs worked. The whole idea is to defer tax now, and use the money as "income" when you're presumably in a lower tax bracket. Seems unlikely that people save enough to withdraw more annually in retirement than they earned during the prime of their careers. A lot of people don't know the tax system and have no clue. I had a whole family get caught up in this scam in my building. Each one owed $40k to CRA after they were caught. There were 5 in the family. I actually talked to the CRA auditor (on another matter with a client of mine) who let the hammer down on them. He told me he could not do anything to the preparer and I scream at him "but he is still in business on Lawrence and Vic Park". I could go on and on but I will stop. Link to post Share on other sites
Zach6668 513 Posted February 1, 2017 Author Share Posted February 1, 2017 A lot of people don't know the tax system and have no clue. I had a whole family get caught up in this scam in my building. Each one owed $40k to CRA after they were caught. There were 5 in the family. I actually talked to the CRA auditor (on another matter with a client of mine) who let the hammer down on them. He told me he could not do anything to the preparer and I scream at him "but he is still in business on Lawrence and Vic Park". I could go on and on but I will stop. Yikes. Maybe I'm taking my knowledge for granted. My mom is in financial services, though not tax related or anything, but that's probably where I get some stuff that I thought was common knowledge. Link to post Share on other sites
FCP Bob 1,312 Posted February 7, 2017 Share Posted February 7, 2017 Yesterday was a nice day for a walk in Etobicoke. Link to post Share on other sites
Babying 613 Posted February 7, 2017 Share Posted February 7, 2017 Wow. Seriously. Wow Link to post Share on other sites
Dubey 1,035 Posted February 7, 2017 Share Posted February 7, 2017 I'm going to check how long it took me to walk my last 41,000 steps..... and the answer is: 11 days Link to post Share on other sites
FCP Bob 1,312 Posted February 7, 2017 Share Posted February 7, 2017 Wow. Seriously. Wow and that's in safety boots not jogging shoes or anything Link to post Share on other sites
digitalmonkey 929 Posted February 7, 2017 Share Posted February 7, 2017 Olameter, Bob? Link to post Share on other sites
FCP Bob 1,312 Posted February 7, 2017 Share Posted February 7, 2017 Olameter, Bob? no I think those are the guys who bid really low and do a shitty job for utilities. The company I work with is a family business that has the Enbridge contract for Southern Ontario plus some other smaller utilities. Link to post Share on other sites
digitalmonkey 929 Posted February 7, 2017 Share Posted February 7, 2017 no I think those are the guys who bid really low and do a shitty job for utilities. The company I work with is a family business that has the Enbridge contract for Southern Ontario plus some other smaller utilities. Good! I had a shitty experience with Olameter. Applied, interviewed, got the job...then they never called again and wouldn't return my messages. Link to post Share on other sites
mrdannyg 274 Posted February 8, 2017 Share Posted February 8, 2017 Bob should be playing Pokémon Go... Link to post Share on other sites
Zach6668 513 Posted February 8, 2017 Author Share Posted February 8, 2017 Bob should be playing Pokémon Go... Except all that stuff is sparse in auto-oriented sprawl. Link to post Share on other sites
mrdannyg 274 Posted February 10, 2017 Share Posted February 10, 2017 Except all that stuff is sparse in auto-oriented sprawl. True, though getting better. And I doubt he feels much like stopping to catch anyway, he can just pop on a few incubators and march off eggs! This post is likely very confusing for anyone who doesn't play... Link to post Share on other sites
Babying 613 Posted February 10, 2017 Share Posted February 10, 2017 The office I rent sucks. My hands are frozen Link to post Share on other sites
Zach6668 513 Posted February 11, 2017 Author Share Posted February 11, 2017 Say I'm too inept/lazy to wash my hand wash only sweater myself, is this a service that a dry cleaning/laundry place might offer? Link to post Share on other sites
iBeaver 409 Posted February 11, 2017 Share Posted February 11, 2017 Yup. Get my sweaters dry cleaned all the time. Makes them last longer. Link to post Share on other sites
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