As you transition into retirement, the way you view your finances changes.
Your focus has likely moved from growing your wealth to maintaining it, and you may be less willing to take risks with your money. You are also in a position to enjoy everything you have worked for. In addition to regular budgeting, you might be planning for vacations, recreational purchases, and other things that will help you enjoy your retirement.
At KWB, we can help you to plan for a comfortable retirement, and help you to maintain that comfort level once the time comes. Your retirement should be a time of enjoyment and relaxation, so we help you to come up with tax minimization strategies that will protect your wealth and put your mind at ease.
For more information on how we can guide you into and through your retirement years, please contact us.
Blog posts about Your Retirement Years
The Value of Advice
What is the value of advice? When it comes to portfolio management, the overall value of the advice can be measured by comparing the performance of one portfolio over another in a specific amount of time. However, when it comes to wealth management, the overall value of the advice discussed regularly with clients is much more difficult to measure. Read on to see some real life examples of the value of the advice given.
What is the value of deferring my OAS benefits, sometimes also called OAS pension, to a future year?
There are several reasons why you might want to defer your OAS benefits, such as:
1) Based on current and future sources of income you may be able to keep thousands more.
2) You’re planning to work past 65
The Enlightened Investor - Fees & Expenses
Fees and expenses are the single biggest reason professional money managers fail to outperform the market return. Learn a little more about what are reasonable fees and what makes up most investment fees.
The Candian Pension Plan (CPP)
The Canadian Pension Plan (CPP) rules are changing, and, unless you are currently collecting on your CPP and are over the age of 65, you need to pay attention.
US Tax Filing
Are you a US citizen? Do you spend more than 120 days per year in the US? If so you may be required to file a US personal tax return.
The Enlightened Investor-Understanding Returns
One thing frustrated investors often lament are their returns. So here's a question. Do you know what your returns really are? Find out more about how to measure your returns including some great but simple investment benchmarks over the last 5 years.
Leasehold Improvements To Your Home Office
Have you made some renovations or leasehold improvements to your home office? You should be claiming any “repairs” in the year that they occur, but you have some options when it comes to claiming the amortization from leasehold improvements to your home office.
However be aware that this option may mean losing your homes
Graduated Rate Estates – New Rules for 2016
Starting for 2016 taxation years, inter vivos trusts, trusts created by will and certain estates will be subject to the top taxation rate. There are two exceptions to this change: graduated rate estates and qualified disability trusts.
Graduated tax rates will still apply to these types of estates and trusts.
Income earned and retained in
Is your life insurance costing too much?
For many Canadians, the thought of discussing their life insurance protection AFTER the purchase of a policy is unimaginable. It is difficult enough talking about death the first time, why would we want to discuss it again?
Life Insurance is about the living…not the dead
There are several reasons you might want to consider discussing
Disability Tax Credit
You may qualify for the disability tax credit and not even realize it. If so, you could collect as much as $2,500 a year in tax savings!!!
You do not need to be in a wheelchair to be eligible for the disability tax credit. If someone isn't able to walk the length of a football
The Enlightened Investor: Powers of Attorney for Property
A power of attorney for property is a written document by which a grantor appoints an attorney to act as a substitute decision maker with respect to the grantors property or financial affairs.
This grant of power becomes effective immediately upon the grantor signing the document unless otherwise indicated. While a General Power of Attorney
Registered Education Savings Plan (RESP)
An RESP is an education savings account that is registered with the Government of Canada that helps you save for a child’s post-secondary education.
With an RESP, you may be able to receive other saving incentives, such as the:
Canada Learning Bond
Basic and Additional Canada Education Savings Grant
There are two different types of RESPs
Electing out of CPP payments
Did you know that if you are receiving CPP benefits, are still working and are between the ages of 65 and 70, you can elect to stop making CPP contributions.
Contributing to the Canada Pension Plan (CPP) is mandatory for working Canadians between the ages of 18 and 64, but optional after age 65.
Estate Planning Gifting Strategy
An estate planning gifting strategy is basically when you start to give away some of your assets prior to death in order to optimize taxes within the family.
Usually, an estate planning gifting strategy refers to how we will distribute our assets when we die. But you might be overlooking significant tax savings by not
Spousal Loan - Tax Savings Opportunity
If you are in a much higher income tax bracket then your spouse and have investments outside of an RRSP or TFSA then a spousal loan could reduce your taxes.
Money that is earned directly by you through employment or investing is considered yours and can’t just be given to your spouse to invest.
HOME ACCESSIBILITY TAX CREDIT (HATC)
The 2015 federal budget announced the introduction of a new Home Accessibility Tax Credit (HATC), beginning in 2016.
The HATC is a non-refundable tax credit for qualifying expenses incurred for work performed or goods acquired in respect of a qualifying renovation of an eligible dwelling of a qualifying individual. A qualifying individual and eligible individuals
The Enlightened Investor:Calculating the Cost Base of a Security Held in Multiple Taxable Accounts
Congratulations! You just sold and realized a profit on that promising investment (stock, mutual fund, ETF etc.). When you’re done planning how to spend your windfall you might also consider how much tax you owe on that gain. Unless the sale occurred within a non-taxable RSP or TSFA.
Normally, this is fairly straightforward. You
The Secret to Fitting a Healthy Lifestyle into your Busy World-Part 2
Part 2 of an article on Healthy Lifestyles.
See Part 1 posted on October 28, 2015.
Strategic Step #2: Automate & Re-Engineer Your Environment
We are creatures of habit. Did you know that on a typical day you make about 300 decisions about nutrition? Most of them are done unconsciously and can often lead to
The Secret to Fitting a Healthy Lifestyle into your Busy World-Part 1
Entrepreneurs, business owners, and professionals often lead very busy lives. Being one myself I can relate to wearing many different hats, starting early, ending late, and seeing it have the impact on my lifestyle and my health.
So many of us get into an unconscious pattern that just becomes our normal way of being. Unfortunately
The Enlightened Investor: What is meant by “market return”?
The investment industry and media often refer to the “market” and the “market return”.
Or that the market was up or down on the day and that a portfolio manager's return outperformed or underperformed the market return. So what exactly do they mean and how does it relate to you?
The market generally refers to
Deciding when it’s time to start taking your CPP retirement benefits
You can start receiving CPP pension benefits when you reach age 65 (the month after your 65th birthday) which will entitle you to a full CPP benefit depending on how much and how long you have contributed to the CPP.
However, you have the following choices:
Take a reduced CPP retirement pension as early as
Applying for a trust account number or asking for a clearance certificate
Applying for a trust account number
Trustees can apply for a trust account number before filing their T3RET, T3 Trust Income Tax and Information Return. Trust account numbers start with the letter “T” and are followed by an eight-digit number.
You can use Form T3 APP, Application for Trust Account Number to apply for a
Change in use of property from capital to inventory or vice versa.
There are no immediate repercussions for the change in business use of property from capital to inventory. The differences arise upon sale of the real estate.
There is no provision in the Income Tax Act which describes the circumstances in which gains from the sale of real estate are to be determined as being either
Deductible medical costs if you qualify for a disability tax credit
A taxpayer can claim medical expenses paid for themselves as well as for their spouse, common-law partner and dependents.
A dependent can include;
the taxpayer or their spouse/common law partner's child or grandchild or
the taxpayer of their spouse/common law partner's parent, grandparent, sibling, uncle, aunt, niece or nephew whom lived in Canada at any
The Enlightened Investor – Risk (ETF’s)
Investors often remark that the world economy has changed and that it's more volatile than ever. They are less trusting of stock markets and they don't want to take risk.
I can't say I blame them. I might ask though, if the world has changed, if it is more volatile, "how are you changing the
Retirement Planning Alternatives
We have all been told to plan for our retirement. Yet, have you ever wondered WHY?
Perhaps you have a plan, most people do, but is it the RIGHT plan? In the following example, it is clear how ADVANCED planning can make a huge difference for you and your loved ones.
In the table
The Enlightened Investor - A Game Plan
Do you make investment decisions according to what looks good at the moment? These purchases are often based on opinion and influenced by emotion. It can be exciting - much like buying lottery tickets.
Clearly, following a predetermined, diversified, well-thought-out, long-term investment strategy is preferable. Here’s why.
Dalbar’s study of investor behavior shows how investor
Why should I review my Unanimous Shareholder Agreement?
If you haven’t reviewed your Unanimous Shareholder Agreement (USA) recently, here are 3 excellent reasons why you should do so:
In 2006, the Federal Budget introduced a second dividend rate. Corporate earnings in Alberta, up to $500,000 are taxed at 14%; when a dividend is paid to an individual shareholder this “ineligible-dividend” is taxed
The Enlightened Investor: A Diversified Portfolio vs. a Collection of Investments “The Only Two Things You Need to Know About Modern Portfolio Theory”
Our best technique for protecting portfolios is called Modern Portfolio Theory.
This Nobel Prize winning idea said it is insufficient to look at investments in isolation as is done in the traditional approach of picking stocks and bonds. Rather rational investors will seek out “efficiently diversified portfolios” offering the highest expected return for each level
The Enlightened Investor: A Diversified Portfolio vs. a Collection of Investments - “Recovery Returns”
Do you want a portfolio that’s vulnerable to wild swings in value? Likely not. In fact less volatile portfolios are both easier on the stomach and they help you achieve better long-term returns.
For example, a portfolio that declines 10% this year requires an increase of 12% next year to recover its losses. If your
Medical Expenses including Attendant Care
A taxpayer can claim medical expenses paid for themselves as well as for their spouse, common-law partner and dependents. A dependent can include;
the taxpayer or their spouse/common law partner's child or granchild or
the taxpayer of their spouse/common law partner's parent, grandparent, sibling, uncle, aunt, niece or nephew whom lived in Canada at any time during
Structuring the legal ownership of your home
What's the best structure to have for the legal title of your home?
The answer is...it depends.
Are you asking for tax planning purposes or for estate planning purposes?
Often you may be advised that it's important for you to have the title of your home shared with somebody else so that if something
Principle Residence Exemption
If you have sold your home and it is your principle residence then you should be able to use the principle residence exemption to reduce or eliminate any capital gain for income tax purposes on the sale of the property.
CRA states that a principle residence can be a house, cottage, condominium, apartment, trailer, mobile
CPP Death Benefit and Survivor Payment
CPP death benefit
The CPP death benefit is a one-time, lump-sum payment to the estate of the deceased contributor. It must be applied for within 60 days of the decedent’s date of death.
The CPP death benefit can be paid to:
The estate of the decedent(if there is an estate)
The person who paid the
The Enlightened Investor-Retirement Income
Eventually investors move from the “saving-years” to the “drawing-years”, when they want to start drawing an income from their portfolios.
This can be confusing. For many the natural inclination is to liquidate their diversified portfolio in favor of income-producing stocks or bonds. However, the idea that retired individuals should load up on dividend-paying common shares
The Enlightened Investor: Is Your Portfolio Leaking Tax?
It may be obvious to state that an investor only keeps the after-tax return. It is less obvious how to minimize the tax leakage from your portfolio.
A good starting point is to identify the two primary causes of tax; portfolio turnover and an inefficient portfolio structure.
Taxes resulting from portfolio turnover can cost you
Resident or Non-resident in Canada
Under the Canadian income tax system, an individual's liability for income tax is based on his or her status as a resident or a non-resident of Canada.
An individual who is resident in Canada during a tax year is subject to Canadian income tax on his or her worldwide income from all sources. Generally, a
Changes to the Principal Residence Exemption
The Canada Revenue Agency (CRA) has made a major change to the Principal Residence Exemption that will affect Canadians when filing their 2016 tax returns. Regardless of whether the sale is exempt or not, individuals will now be required to report the sale of their principal residence on their personal tax return.
Under the Principal
Child Rearing Provision
If you left the work force or reduced your working hours to be the primary caregiver for your children, it will likely be to your benefit to apply for the CPP child rearing provision when applying for CPP benefits.
To apply for the CPP child rearing provision you would complete section 11A in the application
Direct Beneficiary Designation - RRSP or RRIF
If you are considering a direct beneficiary designation for either a Registered Retirement Savings Plan (RRSP) or a Registered Retirement Income Fund (RRIF), you should be aware of some negative consequences that can occur.
A direct beneficiary designation can result in unintended tax consequences to the estate, the inequitable treatment of heirs or the distribution
Capital Dividend Account
What is the capital dividend account?
The capital dividend account (CDA) tracks the amounts that can be paid out to shareholders, tax free.
How is the capital dividend account balance created?
Capital gains and losses - The balance increases by 50% of any capital gains your company incurs, and decreases by 50% of any capital
When to Apply for CPP Benefits
The amount of CPP benefits that you are eligible to receive depends on how long you earned employment income, and how much you earned in those years.
You can visit the My Service Canada website to see how much you have paid in to CPP over your working years. This information is used to calculate
Proposals from the Department of Finance on July 18, 2017 included changes to the taxation of split income.
The most common form of split income is income from a dividend from a related entity that is not excluded from being categorized as such.
Prior to 2018, shareholders of privately held companies over the age of