Finding the shortest and safest route to any of your dreams requires planning and only with a carefully thought out financial plan can you be sure to make the most of your resources and to protect against risks along the way. At Worby Wealth Management, Chris & Jeremiah Worby will do their best to help you achieve those dreams with a plan that is tailored to your specific needs and based on your individual situation.Let Trusted Regina Financial Advisors Chris & Jeremiah Worby of Worby Wealth Management help you live your dream!
One of the biggest financial questions on everyone’s mind is whether or not they will have enough money to retire? Not only do savings and investments need to be taken into the equation, income and expenses also need in-depth analysis.
Old Age Security (OAS)
The OAS pension is a monthly pension payment payable to eligible individuals. OAS pension benefits are considered taxable income. To be eligible for full payment, you must:
• be 65 or older
• be a Canadian citizen or legal resident of Canada at the time of application approval
• if you no longer live in Canada (a non-resident), you were a Canadian citizen or legal resident of Canada on the day preceding the day of departure from Canada
• have lived in Canada for a minimum of 10 years (or 20 years for non-residents) after reaching age 18
Individuals who have lived in Canada for 40 years after the age of 18 are eligible for 100% of the OAS pension benefit.
Canada Pension Plan (CPP)
CPP program benefits, except for the death benefit, are indexed annually for increases in the cost of living. In order to receive CPP program benefits, eligible individuals must apply. Benefits are not automatically paid once someone reaches the age of eligibility. Applications are accepted via two methods; online through the My Service Canada Account, or via paper forms mailed to the applicable Provincial CPP office.
You can start receiving CPP as early as age 60 (at a reduced rate) and as late as age 70 (at an increased rate). The maximum CPP payment in 2022 is $1,253.59 a month.
Tax Free Savings Account (TFSA)
The tax-free savings account (TFSA) provides a way to earn investment income tax-free. Whereas other registered accounts allow the deferral of tax on income earned within the plan; the TFSA is unique in that any investment income earned within the plan is tax-free when it is withdrawn. In order to open a TFSA account, you must have reached the age of majority, defined as age 18 or 19, for the province or territory in which you live. The types of investments permitted in a TFSA include cash, mutual funds, securities listed on a designated stock exchange, guaranteed investment certificates (GICs), bonds, and certain shares of small business corporations.
The annual TFSA dollar limit was established at $5,000 in 2009, the year that TFSAs were introduced as a registered account. Any unused amounts are carried forward to future years. The $6,000 contribution room for 2022 means the lifetime contribution limit is now $81,500.
Registered Retirement Savings Plan (RRSP)
A registered retirement savings plan (RRSP) is a type of registered savings plan set up underthe Income Tax Act and registered with the Canada Revenue Agency. An RRSP is not an investment; you cannot buy an RRSP. Instead, an RRSP is a registered investment vehicle within which investors can deposit various types of investments. In order to contribute to anRRSP, an individual must have earned income.
The growth of money invested inside an RRSP is not subject to tax until it is withdrawn. In other words, the tax payable on investment growth is deferred until the future. Since income earned inside an RRSP is tax-sheltered, RRSP investments grow much faster than non-registered investments held outside an RRSP.
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Whether you’re 30 years away or just a few months from retirement, proper retirement planning is essential. Contact Worby Wealth Management to start planning your retirement today.
*Source: Canadian Investment Funds Course
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TRUSTED REGINA FINANCIAL ADVISOR Chris Worby from Worby Wealth Management helps you live your dream!