“Welcome to the PlanEasy blog! We make personal finance easy.

Thanks for visiting.”

– Owen

When To Take Old Age Security? Should You Delay OAS To Get The Maximum OAS Benefit?

When To Take Old Age Security? Should You Delay OAS To Get The Maximum OAS Benefit?

When is the best time to take Old Age Security (OAS)? Should you delay OAS to get the maximum benefit? Or should you take OAS as early as possible?

Old Age Security is a government retirement benefit paid to seniors over the age of 65. Unlike Canada Pension Plan, Old Age Security payments come from government revenue. It has nothing to do with contributions. It has everything to do with how long you’ve been in Canada. And unlike CPP, it can be “clawed back”.

It can also be substantial. Old Age Security is worth over $7,000 per person per year if you receive the maximum benefit. For a couple that’s over $14,000 per year in retirement income. This increases with inflation every 3-months.

And like CPP, OAS payments increase the longer you delay it. The earliest OAS can start is at age 65, but for every month you delay OAS payments the benefit increases by 0.6%. If you choose to delay for a full year your OAS benefits would be 7.2% higher. If you choose to delay the full 5-years to age 70 your OAS benefits would be 36% higher!

Delaying OAS may seem appealing, but should YOU delay OAS to get the maximum OAS benefit in retirement?

Perhaps not, but it depends on your situation.

read more
Avoiding The Risk Of A Long And Healthy Life

Avoiding The Risk Of A Long And Healthy Life

There are many different risks when it comes to retirement, but one risk that isn’t talked about very often is the risk of living a long and healthy life. It may seem odd to call this a risk, but from a financial planning perspective a long and health life increases the risk of running out of money in retirement.

According to the guidelines from the Financial Planning Standards Council of Canada, for a couple who is currently 55, there is a 25% chance that either partner in a couple will live to age 98 and there is a 10% chance that either will live to age 101.

Living a long and healthy life isn’t some obscure risk… for pre-retirees the chance of living to age 100 is around 1 in 10.

This risk becomes even greater for those aiming for early retirement in their 50’s or even 40’s. Retiring at age 55 could mean a 43+year retirement period for 1 in 4 couples and a 46+ year retirement period for 1 in 10 couples.

With such a long retirement period, and such a high possibility of reaching age 90+, we want to ensure that we’re taking steps within our financial plans to avoid the risk of a long life.

There are a few things that anyone can do to avoid this risk…

read more
Getting Our TFSAs To One Million

Getting Our TFSAs To One Million

TFSAs are an amazing tax sheltered account that every Canadian has access to regardless of income. Unlike RRSP contribution room, which is based on employment income, we all get the same amount of TFSA contribution room every year.

The TFSA is a perfect way to save for retirement. In fact, for many young people they are better off starting with their TFSA rather than their RRSP, especially when they’re starting out at a lower income.

At lower income levels the TFSA can provide many advantages versus the RRSP. Namely that future withdrawals aren’t taxed and won’t count towards government benefit claw backs.

There are other benefits to the TFSA too, like if you have a habit of spending your tax refund. If that’s the case then maybe a TFSA contribution is a better idea.

My wife and I have a BIG goal for our TFSAs. Our goal is to grow our combined TFSAs to $1 million by the time we reach early retirement at age 55. This is an ambitious goal, one that we may not meet, but it’s fun to have a BIG financial goal like this. We find it motivating to have BIG financial goals and it gives us something to work toward.

Two years ago I provided an update on our progress to our one million TFSA goal and I think it’s time to do it again. Not just for the accountability but also because it’s good to share how amazing the TFSA is for these kinds of goals.

read more
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Owen Winkelmolen

Fee-for-service financial planner and founder of PlanEasy.ca

“Welcome to the PlanEasy blog! We make personal finance easy.

Thanks for visiting.”

– Owen

New blog posts weekly!

Tax planning, benefit optimization, budgeting, family planning, retirement planning and more...

When To Take Old Age Security? Should You Delay OAS To Get The Maximum OAS Benefit?

When To Take Old Age Security? Should You Delay OAS To Get The Maximum OAS Benefit?

When is the best time to take Old Age Security (OAS)? Should you delay OAS to get the maximum benefit? Or should you take OAS as early as possible?

Old Age Security is a government retirement benefit paid to seniors over the age of 65. Unlike Canada Pension Plan, Old Age Security payments come from government revenue. It has nothing to do with contributions. It has everything to do with how long you’ve been in Canada. And unlike CPP, it can be “clawed back”.

It can also be substantial. Old Age Security is worth over $7,000 per person per year if you receive the maximum benefit. For a couple that’s over $14,000 per year in retirement income. This increases with inflation every 3-months.

And like CPP, OAS payments increase the longer you delay it. The earliest OAS can start is at age 65, but for every month you delay OAS payments the benefit increases by 0.6%. If you choose to delay for a full year your OAS benefits would be 7.2% higher. If you choose to delay the full 5-years to age 70 your OAS benefits would be 36% higher!

Delaying OAS may seem appealing, but should YOU delay OAS to get the maximum OAS benefit in retirement?

Perhaps not, but it depends on your situation.

read more
Avoiding The Risk Of A Long And Healthy Life

Avoiding The Risk Of A Long And Healthy Life

There are many different risks when it comes to retirement, but one risk that isn’t talked about very often is the risk of living a long and healthy life. It may seem odd to call this a risk, but from a financial planning perspective a long and health life increases the risk of running out of money in retirement.

According to the guidelines from the Financial Planning Standards Council of Canada, for a couple who is currently 55, there is a 25% chance that either partner in a couple will live to age 98 and there is a 10% chance that either will live to age 101.

Living a long and healthy life isn’t some obscure risk… for pre-retirees the chance of living to age 100 is around 1 in 10.

This risk becomes even greater for those aiming for early retirement in their 50’s or even 40’s. Retiring at age 55 could mean a 43+year retirement period for 1 in 4 couples and a 46+ year retirement period for 1 in 10 couples.

With such a long retirement period, and such a high possibility of reaching age 90+, we want to ensure that we’re taking steps within our financial plans to avoid the risk of a long life.

There are a few things that anyone can do to avoid this risk…

read more
Getting Our TFSAs To One Million

Getting Our TFSAs To One Million

TFSAs are an amazing tax sheltered account that every Canadian has access to regardless of income. Unlike RRSP contribution room, which is based on employment income, we all get the same amount of TFSA contribution room every year.

The TFSA is a perfect way to save for retirement. In fact, for many young people they are better off starting with their TFSA rather than their RRSP, especially when they’re starting out at a lower income.

At lower income levels the TFSA can provide many advantages versus the RRSP. Namely that future withdrawals aren’t taxed and won’t count towards government benefit claw backs.

There are other benefits to the TFSA too, like if you have a habit of spending your tax refund. If that’s the case then maybe a TFSA contribution is a better idea.

My wife and I have a BIG goal for our TFSAs. Our goal is to grow our combined TFSAs to $1 million by the time we reach early retirement at age 55. This is an ambitious goal, one that we may not meet, but it’s fun to have a BIG financial goal like this. We find it motivating to have BIG financial goals and it gives us something to work toward.

Two years ago I provided an update on our progress to our one million TFSA goal and I think it’s time to do it again. Not just for the accountability but also because it’s good to share how amazing the TFSA is for these kinds of goals.

read more
Page 4 of 47...23456...

New blog posts weekly!

Tax planning, benefit optimization, budgeting, family planning, retirement planning and more...

New blog posts weekly!

Tax planning, benefit optimization, budgeting, family planning, retirement planning and more...

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