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Posts from the ‘Retirement Planning’ Category

Defined Benefit Pensions: Steps to Get the Most Out of Your Pension

Introduction

Some people like to say God that is “in the details” while others claim say it is the devil that calls the shots. In any event, the financial planner part of me wonders if whoever coined these expressions was secretly thinking about defined benefit pension plans. Sometimes, the details of a plan are a safety blanket that makes sure you’re covered regardless of what happens next while in other instances, the fine print is a trip wire that leads to catastrophe. Fortunately, whether your plan is a safety net or tsunami isn’t entirely a matter of chance; the choices you make at key points along the way have a lot of impact over what happens later. As a result, I want to talk about some of these key decisions and the things you can do to make your future a little bit more like heaven and a lot less like hell.

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Wills, Thrills and Chills – Changes to Wills and Estates Law in British Columbia

I am the first to admit that lawyers generally a pretty conservative bunch; if something has worked well enough in the past (no matter how ancient), then why rock the boat by trying something new? Sometimes, however, even the most cautious and traditional of lawyers realize that it’s time for a change. Accordingly, after many, many years of consideration, contemplation and conversation, our province has implemented sweeping changes to the rules regarding wills and estates through a single new piece of legislation entitled the Wills, Estates and Succession Act that consolidates many other statutes into one stop shopping. Essentially, it’s like making 90 years of changes all at once.

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The OAS Pension Recovery Tax What To Do if the Clawback Ain’t For You (Part 2)

Introduction

Now that you know how the OAS pension clawback is applied and its actual effects on your bottom line in after-tax dollars, I want to pass along ways you can organize your affairs so that you can get (and keep!) as much of your Old Age Security Pension that is humanly possible. Since a lot (but not all) of these techniques focus on keeping your taxable income down, you might also save some income tax dollars, too, if you’re not careful.

Before diving in, I realized that there was one additional situation where I see seniors taking an unwanted sojourn into the clawback zone that merits comment: the curse of the saver. If you are one of those thrifty and savvy investors who actually grow their incomes during retirement, you could unwittingly end up in the clawback zone at some point. Even if you don’t become a regular inhabitant, you still may be an occasional visitor during years you report significant capital gains. Accordingly, this article is written for those of you as well in the hopes of keeping your visits to this unpopular destination as infrequent as possible.

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The OAS Pension Recovery Tax: What To Do if the Claw back Ain’t For You

If you really want to light a fire in belly of most middle class retirees, I strongly suggest turning the conversation to how their OAS pensions are reduced if their taxable incomes top about $71,000 as of July, 2014. More specifically, they will lose $.15 for every dollar in taxable income they receive above that point until, if they make enough, their entire OAS pension of $6,618.48 (what most long-time Canadians receive if they take their pension as soon as possible as of May, 2014) is a thing of the past. I plan to use this and a subsequent article or two to explain how the claw back works and some steps you can take to minimize the impact. Today’s offering will set the stage and explain why dividends may not be as good as advertised when the claw back comes calling.

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