Thu. Jun 30th, 2022

A survey commissioned by Bromwich + Smith and Advisorsavvy says four-in-10 Canadians aged 55-plus have delayed or plan to delay their retirement because they have too much debt.coldsnowstorm / iStockPhoto / Getty Images

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Just over half (54 per cent) of older Canadians have delayed retirement because of mounting inflation and cost of living this year alone, a new survey shows.

The survey, commissioned by Bromwich + Smith and Advisorsavvy, also says four-in-10 Canadians aged 55-plus have delayed or plan to delay their retirement because they have too much debt. Meanwhile, nearly two-thirds (62 per cent) have delayed retirement because they do not have enough savings or investments.

“Canadians are all feeling a bit exhausted from the last two years, between multiple waves of COVID-19 and a tattered economy,” said Laurie Campbell, director, client financial wellness at Bromwich + Smith stated in the survey release. “For those close to retirement, 2022 might seem like the best year to do so. But with inflation still high and bank accounts and retirement savings being depleted, it might be wise to ask yourself, can I retire in 2022? ”

Calling all retirees: Are you a retiree interested in discussing what life is like now that you’ve stopped working? Globe Investor is looking for people to participate in its Tales from the Golden Age feature, which discusses the realities of retirement living. If you’re interested in being interviewed for this feature, and agree to use your full name and have a photo taken, please email us a few details about your retirement life so far at:

‘Money and aging are very closely tied’ in end-of-life planning

Having difficult or awkward conversations with clients is a big part of an advisor’s job when fine-tuning financial plans to meet their needs.

However, discussions around aging and end-of-life planning can be even more taxing because it forces clients to consider morbid events and how to safeguard against unforeseen and unfortunate circumstances.

Globe Advisor editor Pablo Fuchs recently spoke with Mallory McGrath, founder and chief executive officer of Viive Planning, about what issues need to be brought up as part of this process and the major considerations involved in this type of planning. Read the article here

What to consider when leaving Canada to live in another country

Leaving Canada to live or work in another country is a major personal and financial decision – one that advisors need to review carefully with clients to ensure they understand the various tax implications and critical document-filing deadlines.

Ottawa imposes various rules on Canadians who emigrate to another country and become a non-resident for income tax purposes. For example, banks need to be notified and tax returns filed.

Canadians who sever ties with the country are also automatically considered to have sold certain types of property such as shares, valuable artwork and foreign property, even if they have not actually been sold, based on fair market value. The Canada Revenue Agency (CRA) considers it a deemed disposition, and Canadian emigrants may also have to report a capital gain, known as a departure tax.

Exceptions include pensions and registered investments, such as a registered retirement savings plan (RRSP) or tax-free savings account (TFSA), and Canadian property that remains in Canada, including a business and its inventory, with some exceptions. Items worth less than $ 10,000 such as clothing, household goods and cars are exempt, according to the CRA. Brenda Bouw reports for Globe Advisor

Should Eileen sell her house to pay off the mortgage before retirement?

At age 57 and on her own again, Eileen is looking to a future quite different from what she might have imagined. She’s still living in the family home in a pricey Toronto bedroom community, but now it’s mortgaged to roughly half of its value. She also retained ownership of the family cottage.

Eileen would like to retire from her high-paying executive job at age 65. She’s bringing in anywhere from $ 350,000 to $ 400,000 a year in salary, bonus and company stock. She also has substantial savings and investments.

“Should I be selling my house so that I can pay off the mortgage before I retire?” Eileen asks in an e-mail. “Or am I better off staying where I am?” She figures she would not be able to afford anything in her existing neighborhood without taking on another big mortgage.

Two of her four young adult children are still living at home, but one will be off to university soon and the other is thinking of moving out in a year or two. The children range in age from 18 to 28. Eileen also asks about the best way to set things up if she wants to give each of her children $ 40,000. Her retirement spending goal is $ 70,000 a year after tax. In the latest Financial Facelift, Amit Goel, a portfolio manager and partner at Hillsdale Investment Management Inc. of Toronto, looks at Eileen’s situation.

Interested in being featured in the Globe’s Financial Facelift feature? Email us about your unique financial situation at You can share your story under a false name and our photographers will obscure your identity in one of our trademark Financial Facelift photos. We’re especially keen to hear from people without a defined benefit pension plan looking for advice on how to navigate their finances for retirement and other financial goals.

In case you missed it

How to sell the family cottage without upsetting the kids

Amid rising values ​​for recreational properties, not to mention annual costs such as taxes and upkeep, the unhappy challenge for many older Canadians is how to sell the cherished family cottage without upsetting their children.

For some, the decision to sell might be financial, as the attendant costs of property ownership only go higher. For others, it could be health reasons, the death of a spouse or the reality that for all the wonderful memories the property created, the kids and grandkids do not use it enough to justify keeping it.

Regardless of the underlying reasoning behind any sale, letting go can be a lot more difficult than selecting an agent and listing the property.

“The biggest difference I find between urban real estate and recreation real estate is the emotional attachment people have to their recreational properties,” says Rob Serediuk, an agent with Sotheby’s International Realty Canada who specializes in cottage properties in Ontario’s Haliburton and Muskoka regions.

He notes that prices for vacation properties soared during the pandemic when people began working remotely. Now, with urban property prices retreating with higher interest rates, he expects more recreational property to come on the market.

“There are a lot of people that are on the fence on whether or not they want to sell,” he says. Paul Brent reports

What older parents should know about paying for their child’s wedding

People are getting married later in life, a trend that’s giving parents who pitch in more time to save. However, financial advisers caution the cost comes at a time when parents might need to earmark the money for themselves.

Being close to retirement “can make it difficult to take a big chunk of money and hand it over, even if it is for a celebration you want to help your child with,” says Jason Heath, managing director of Markham, Ont.-based Objective Financial Partners Inc.

“Often, I end up having discussions with clients about how much they can help out their children, whether it’s for a wedding or otherwise, without compromising their own finances.”

The good news for parents with children heading to the altar is that wedding costs are now often spread out among family members. In the past, a bride’s parents traditionally paid for the wedding and reception, and the groom’s parents for the rehearsal dinner and bar. Times have changed. Many couples are chipping in to cover their own wedding costs.

“They have established their careers, which means that they are also in a very different position financially than couples would have been 30 years ago,” wedding planner Karina Lemke says. Dene Moore reports

Ask Sixty Five

Question: I’ve heard that I do not need to convert any of my registered retirement savings plan (RRSP) into a registered retirement income fund (RRIF) at age 65 to be able to claim the federal pension credit. I’ve heard that withdrawing money from an RRSP at 65 would entitle me to claim the federal pension credit. Is that something you can educate me on? I do not have a pension and plan to delay my old age security (OAS) and Quebec Pension Plan (QPP) benefits until I am 70.

If I do indeed have to covert RRSP money into a RRIF, I would like to know the minimum amount I need to convert to secure the federal pension credit from 65 years old and forward. I do intend to convert my RRSP into a RRIF at age 71. I am turning 62 this year, and I have been retired since I was 59. My current (and until I turn 70) sources of revenue come from my RRSP and non- registered accounts at approximately 50 per cent each. Thanks in advance for your advice!

We asked Mike Preto, an advisor at Hillside Wealth Management in Vancouver, to answer this one:

Great question. Before we get you the answers, here’s a brief explanation of the pension income tax credit. You can claim a federal tax credit of 15 per cent on the first $ 2,000 of eligible pension income. Most provinces also have a credit, although the percentage varies. A 15-per-cent tax credit on $ 2,000 results in $ 300 in tax savings; it’s worth pursuing.

If you are 65 or older, you can only claim the pension income credit on amounts withdrawn from an RRSP if they can come from an annuity inside the RRSP. We do not see this very often.

Once you reach 65, you can always open a RRIF and transfer just enough from your RRSP to your RRIF to claim the credit. You can have an RRSP and a RRIF open simultaneously and you can transfer money from an RRSP to a RRIF and then even back to an RRSP if you so choose.

A head’s up: Most investment dealers will ding you a partial de-registration fee if you pull money out of your RRSP, and many, if not all, will not charge you anything to pull funds from a RRIF. Most investors pay enough in fees; there’s no need to pay more!

Wishing you the best in retirement.

Have a question about money or lifestyle topics for seniors? Please email us at and we will find experts and answer your questions in future newsletters. We can not answer every question, but we’ll do our best. Questions may be edited for length and clarity.


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