I’ve enjoyed listening to David’s videos particularly relating to retirement planning. He touches on many of the most relevant issue facing people approaching retirement. His videos are clear and easy to understand. I will continue to follow Aaron Wealth.
@AaronWealthManagement
2 жыл бұрын
Thank you for your generous comment. I really appreciate your feedback and I'm pleased the videos are useful.
@huejanus5505
2 жыл бұрын
That is, by far, the best explanation of a financial breakdown for retirement i’ve come across. All the other ones i’ve seen always harp on waiting till 71 to collect CPP, period, break even be damned. I’m 61 and recently retired but haven’t taken anything yet, not even my db plan from work which also increases like the CPP when deferred. My dad died at age 42 (heart attack) and grandfather at age 76, my mom is still going at 88. It makes for a difficult choice as when to start collecting. There are other things to consider if you run down your money during the early years of retirement. Do you want to leave your children more money, comes into play. CPP stops when you die. Where do you get the money for a major job, a new roof perhaps, which will cost you tens of thousands today and much, much more by the time you’re 80. If your money is vastly diminished and the bulk of your income is a monthly government cheque. How do you pay? Do you take a loan, put it on a credit card? That gets even more expensive. CPP & OAS won’t front you any money.
@AaronWealthManagement
2 жыл бұрын
Thank you for watching the video and for your thoughtful comments.
@iane2046
3 жыл бұрын
Hi David, thanks for the video and demo of the CRA calculator. One gap I find with the CRA system that a true financial plan offers is that it does not allow calculations as a couple, where income splitting, etc. can be leveraged to optimize retirement income. We are in our early 50s and are building a retirement financial plan with our advisor. We found that just by altering when we decide to take CPP and OAS we could pull up our planned retirement date by 2 years. This really drives home your point about how having a plan allows you to see the outcome of decisions before committing to them. Decisions like when to start CPP/OAS are critical, it is extremely important to model scenarios and make informed decisions. There are of course other factors in play as well, as you note, like longevity and other income sources that need to be factored in.
@AaronWealthManagement
3 жыл бұрын
Thanks for your comment Ian. Great insights on how to use a financial plan to identify the most efficient use of your retirement assets. Great advisors use financial planning software that runs simulations such as Monte Carlo, which considers a wide range of possibilities and helps to reduce uncertainty. Let me know if you need any help.
@cjs1440
2 жыл бұрын
I believe it is not a 'penalty' to take it at age 60, it is an 'advance' on your 65-70 money. If don't take it, and you die, your family gets nothing.
@AaronWealthManagement
2 жыл бұрын
Interesting viewpoint. In a recent video (CPP update) I mentioned your viewpoint as one of the reasons why people take CPP early.
@howardabe9256
Жыл бұрын
Fundamentally I have no argument with your premise and calculations. They are correct. The problem with simplifying these situations is that there are other variables that need to be looked at. What if you do not use the early withdrawals from the CPP, and invest that amount directly into a TFSA/RRSP/open account? Can that amount grow faster than the increases from CPP by delaying? If you are not fully utilizing the TFSA putting the early CPP funds in there might provide more potential growth which is tax free. I guess the question becomes are you more confident dealing with your funds personally or would you be more comfortable relying on the government? Your videos are great and a fantastic source of education, please keep them coming!
@gordthompson824
2 жыл бұрын
Very well explained. Further consideration of course is if you still work and contribute past 60 than 65 makes more sense. If you retire at 55 with a company plan than you could still receive the max at 60 ( minus the 36% ) but not be entitled to the max at 65. Because you would add 5 years of zeros the the equation. Also taking it at 60 may help with the claw back situation for OAS. Or did i miss something. Thanks
@AaronWealthManagement
2 жыл бұрын
You passed the quiz 😄 When to start CPP is different for everyone but it's clear by the average CPP of $779 p/mth that either people are taking CPP early or they didn't contribute their maximum. Thanks for watching the video and for your comment.
@darinpearson2554
2 жыл бұрын
In my opinion, there is a fairly clear answer to when to take CPP if you expect to live to 85 or so. Age 65. At birth, the average life expectancy for a Canadian is 82. If you make it to 60, your life expectancy is 85. If you take CPP at 70 and live to 85, you will receive about $18,000 more than If you started CPP at 65. And, you will have missed out on the utility of the CPP funds during the younger years of your life. Those extra funds ($6,000/year) will only be received in the last three years of your expected life. The choice is clear: Age 65.
@jeckoramosaramosa4588
Жыл бұрын
Its 2023 cost of living are too expensive what ever $$ you can get will be a big help for our family so i think at 60 its good to start getting CPP so i can buy more foods for my family
@BHatMusic
Жыл бұрын
An important detail is that CPP increases by 0.6% per month after age 60 until you reach 65. This is around $50-60 per month more for each month you wait (assuming your max at 65 is around $1000/mo.)
@robthewaywardwoodworker9956
2 жыл бұрын
Enjoying your videos. I have no idea what I will do other than work until I drop dead. Funny, but not funny. Funny because it's true, I guess.
@AaronWealthManagement
2 жыл бұрын
If you love what you do its never work especially in retirement when an interest becomes a side hustle.
@macker0077
2 жыл бұрын
What if you take CPP @ 60 and invest it till 65 or 70? I imagine it could impact your break even point.
@AaronWealthManagement
Жыл бұрын
If you don't need the CPP/OAS income I like the strategy of using it to fund purchasing another income producing asset.
@perkyb1213
Жыл бұрын
Taking it early and investing it( if you don’t need it of course) might be wise. Depends on the market when you pull the trigger I suppose.
@AaronWealthManagement
Жыл бұрын
If you didn't need the money, one strategy would be to use the CPP to fund a whole life insurance policy to maximize the estate value. $1000 per month for a 60 y/o starts at about $275,000 of death benefit and grows to $540,000 by age 87 all funded by CPP.
@oswaldburga9836
Жыл бұрын
You have covered very well every factor involved in the decision to take the best plan, However don't you think that the marital status of the individual his habitual living (smoker, drinker) and the change in the dollar value the later one being most difficult to predict (inflations etc.)
@AaronWealthManagement
Жыл бұрын
The decision of when to begin receiving CPP is different for everyone and you must factor in all the variables. Sometimes it's an easy answer - the person needs the money right away or a family history of passing at relatively young ages. Other times it may be to avoid an OAS Clawback.
@arcanerecovery2567
11 ай бұрын
are you allowed to take cpp at age 60 and still work? how long can you work, just to age 65 or can you work longer?
@debrapearse5116
2 жыл бұрын
Hi David , I have a DBP that I can collect at age 60. What are your thoughts on a person with a DBP collecting their CPP at 60 and investing that money . I ask this question only because of my DBP clawback at 65. Not sure how much of a clawback the government would take? Thanks for all your information 🇨🇦
@AaronWealthManagement
2 жыл бұрын
Hi Debra, thanks for watching the video and great question. I need more information to answer accurately although here are a few ideas. Ideally, schedule time with an advisor to review an optimal strategy to achieve your retirement income goals. *OAS clawback* is triggered when your net income is $79,054 or higher (2021) and $81,761 (2022). OAS clawback results in a reduction of OAS benefits by 15 cents for every $1 above the threshold amount and is essentially an additional 15% tax. *Income Splitting:* of pension and other income such as Registered Retirement Income Funds (RRIF), annuity payments, and CPP pension sharing between spouses can lower individual income for either spouse and help you limit or avoid OAS clawbacks. *RRIF Setup:* This will lower the mandatory minimum annual withdrawal requirement and lower your overall net income for OAS calculations. *Early CPP:* Taking CPP early is normally recommended if one requires the income or has a history of younger mortality age. Keep in mind the CPP reduction is 7.2% per year so you would need to achieve a return greater than 7.2%.
@Ron_at_Home
3 жыл бұрын
You made an error when you hit next on the Quebec CPP question in the calculator. You should have selected "Canada Pension Plan". Your final calculator totals omit CPP entirely. The brown bar in the calculator is actually Old Age Security and not CPP.
@AaronWealthManagement
3 жыл бұрын
Thanks for pointing that out. I was attempting a live, first time use of their tool to try to illustrate a real life user experience. Have you sued their tool. Was it useful for you?
@Ron_at_Home
3 жыл бұрын
@@AaronWealthManagement Yes I have used their calculator tool and find it useful. It was the first time I learned about OAS clawbacks as I tried different RRSP withdrawal strategies. Thanks for your content!
@ztekz
3 жыл бұрын
Agree with this as I use this tool to get a better idea for my retirement planning! Even better, by using My Svc Cda you can get the most recent estimate of your CPP at age 65 and use that number to plug in using the retirement calculator. The only thing with My Svc Cda is you have to register first (if not yet) for the first time then they’ll mail you the security code to create your login but after that you can just login whenever…
@andydobson8326
Жыл бұрын
What do you charge for a financial plan - married couple?
@AaronWealthManagement
Жыл бұрын
Financial Plans are available at no additional cost for my clients only. They are updated each year during they’re annual review including their Financial Dashboard.
@markboudreau1276
Жыл бұрын
You aren''t considering taking at 60 and investing in your RRSP then taking the difference at 65 out of that investment, this moves the break even point to around 81 if you just get a 5% return.
@AaronWealthManagement
Жыл бұрын
Hi Mark, true although were just examining CPP by itself without any strategies.
@dianetownsend9813
Жыл бұрын
Did you factor in interest from age 60 to 65 on cpp income?
@brianmcgrath5977
2 жыл бұрын
For the algorithm
@lindasands448
2 жыл бұрын
I was put on cpp at the age 55 because of work related accident how will that last
@lindasands448
2 жыл бұрын
long will that last
@pweir2005
Жыл бұрын
reat video...i have a question if you can answer it....if i take CPP at 60 so receive the 640 / per month as per the example of reduce 36 Percent of $1000......at 65 i would have received the complete 1000 / month..and 70 receive 1420 as per the examples of increase of 42 %...great understand all that. But at 65 if i took the pension early would i still receive the 640 per month because its reduced or would i then at 65 receive the full amount back to 1000 / month with no further penalty? does that make sense ? does the penalty of the reduced amount continue after 65 or do you regain the full amount with no reduction?? thanks keep up the great info
@AaronWealthManagement
Жыл бұрын
CPP is permanently reduced when taken early annually increased by CPI
Пікірлер: 39