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“I retired on June 30, at the age of 65,” says Beth Jay, 65, of Halfmoon Bay, B.C., in this Tales from the Golden Age article. She first worked for 20 years as a medical lab technologist and the final 20 years as a teacher and librarian at a couple of elementary schools. “I aged out of my employment life,” she says. “The gap between my age and those of my students continued to widen. Plus, I was getting tired.”

Retirement felt odd at first, says Jay, especially when September hit and everyone was heading back to school. “I felt like I was supposed to be there. I was suddenly out of the loop. I’m over it now. I like that if I don’t sleep well, it doesn’t matter because I don’t have to get up and go to work feeling tired.” Jay had an unexpected health issue for the first few months of retirement, which has limited some of what she had planned to do, including travelling and outdoor activities such as cycling, kayaking and hiking.

She still plays music, including electric bass with her jazz group and flute with the local community concert band. “It’s not the retirement I expected but I also like to garden, cook, bake and read – and I’m writing a memoir.” Jay says she also has more of a social life now that she’s not working because she’s not always exhausted.

Jay has been a saver throughout her life, which she says set her up nicely for retirement. “I used to have a financial advisor who put my investments in mutual funds and bonds, but I got out of the market entirely when I turned 60. I couldn’t stand the ups and downs. I decided I didn’t want to lose another penny.”

After reading the book Enough Bull by David Trahair, Jay changed her financial strategy and invested only in guaranteed investment certificates (GICs). “Today, most of my RRSP investments are in laddered GICs. Of course, that’s not great when interest rates are low, but I don’t care because at least I know my money will always be there. To me, the stock market is a casino and I’m not willing to gamble.”

Her retirement income strategy is to divest her RRSPs first, over about 15 years, so that she can pay all the necessary taxes as early as possible, followed by a blend of non-registered funds and registered TFSA funds. “I started collecting my Canada Pension Plan and Old Age Security benefits at 65, and I also have a small teacher’s pension and an annuity, which gives me a base, guaranteed income.”

Read the full article here.

Are you a Canadian retiree interested in discussing what life is like now that you’ve stopped working? The Globe is looking for people to participate in its Tales from the Golden Age feature, which examines the personal and financial realities of retirement. If you’re interested in being interviewed for this feature and agree to use your full name and have a photo taken, please e-mail us at: goldenageglobe@gmail.com. Please include a few details about how you saved and invested for retirement and what your life is like now.

Emergency heart surgery in his mid-50s has led Max and his wife, Peg, to rethink how much longer they want to keep working.

“The unexpected event was indeed the proverbial wake-up call,” Max writes in an e-mail. “It has given us the opportunity to explore a series of deep, existential questions, which in turn has ignited a desire for us to retire as soon as possible.”

He’ll be leaving behind a $238,000-a-year executive position and Peg a $142,000-a-year job in communications. Max is 56 years old, Peg is 58. They have no children.

Max and Peg share ownership of a Greater Toronto Area house with his parents. A while ago, they put a down payment on a prebuild condo in a nearby town, planning to retire there, but have since decided to sell it and move to the East Coast instead. They hope to retire next year.

Max has defined benefit pensions that together will pay $3,955 a month indexed to inflation. Peg, an American, has a 401k – similar to a registered retirement income fund (RRIF) – from which she plans to withdraw US$4,550 a month until it is exhausted. She also has a defined benefit plan with her current employer that will pay $500 a month indexed.

Their retirement spending goal is $120,000 a year after tax, more than they are spending now.

In this Financial Facelift, Matthew Ardrey, a portfolio manager and certified financial planner at TriDelta Private Wealth in Toronto, looks at Max and Peg’s situation. Mr. Ardrey also holds the advanced registered financial planner (RFP) designation.

According to Statistics Canada, only 37.5 per cent of Canadians are covered by a workplace pension plan – forcing the vast majority to rely on their personal savings and government support for their retirement income. Given the changing nature of workplace pension plan coverage and the decline in Canadians with access to such plans, The Globe wants to hear about your pensions (or lack thereof) for a future series of articles about workplace pension plans.

Do you have a pension plan? Does the offer of a workplace pension make a difference when choosing an employer? And are you concerned about a pension being reduced or lost due to an employer’s financial troubles? Take our survey by filling out the form here or clicking this link. You can also send an e-mail to audience@globeandmail.com.

The information from this form will only be used for journalistic purposes, and we may contact you to find out more about your pension plans. You may choose to be anonymous, but we do require an e-mail address.

Forget financial new year’s resolutions – personal finance columnist Rob Carrick likes the idea of tidying up your finances before Dec. 31, so you can coast into the new year in good shape.

One of the things you should pay attention to in the next six or so weeks, he adds, is your tax-free savings account.

From timing your investments to avoiding risk of over-contribution penalties to ensuring you’ve named a beneficiary, here are five TFSA moves to make before the end of 2024, according to Carrick.

Subscribe to Carrick on Money here.

Use our TFSA Limit calculator to determine your annual contribution room limit.

Baby boomers are set to leave more than $1-trillion to their heirs in the coming years, representing the biggest wealth transfer between generations in Canadian history, writes Jamie Sturgeon in this Investing article.

Those who intend to pass on 100 per cent of their wealth to their children upon death anticipate their estate will average about $960,000, according to an Ipsos survey conducted last year. It’s a sum that could go a long way in helping the next generation today, prompting more Canadians to ask, “Why wait?”

A big motivation for giving while living is the ability to see how the money being used to help loved ones, says Jamie Golombek, managing director of tax and estate planning at CIBC Private Wealth in Toronto. “We’re seeing this a lot now.”

Clients are using such gifts to help children buy housing, pay down debt, save for their future or pursue other dreams.

“Many people plan to leave their wealth via some type of inheritance but are realizing that their kids are struggling currently. They’re saying, ‘Look, we can help,’” Mr. Golombek says.

He adds that a main objective has been helping with the purchase of a primary residence.

“It’s almost impossible, depending on the market, for the average Canadian to afford a down payment for a first home without some type of financial assistance,” Mr. Golombek says. “In cities such as Toronto and Vancouver, we’ve seen skyrocketing prices for even basic entry-level condos or single-family homes. So, in many cases, parents are talking about making that gift now if they’re able to financially.”

Read the full article here.

Q: I worked in the U.S. for several years and am now 60 and back in Canada. I plan to retire soon. I don’t have U.S. citizenship or a U.S. green card. What should I know when transferring a 401(k) to a Canadian RRSP? Also, are there any tax considerations that may be coming under the new U.S. president that might affect my timing or offer some tax relief?

We asked Tanzeela Ayub, partner, cross-border tax, KPMG Family Office, to answer this one.

A: Transferring retirement funds from a U.S. 401(k) plan to a Canadian RRSP can be a complex process that requires careful consideration of both U.S. and Canadian tax regulations.

As a Canadian resident, you can withdraw funds from your 401(k) and transfer the lump sum to an RRSP. The transfer is allowed if services related to the 401(k) were performed while you were residing in the U.S. If you performed any services in the U.S. while living in Canada (for example, daily cross-borders commuters) the funds must first be rolled over to a U.S. Individual Retirement Account or IRA. The IRA can then be transferred to an RRSP.

When you withdraw your funds, they are subject to U.S. tax. Your U.S. plan administrator will withhold a 30 per cent tax on the amount withdrawn, which may be reduced to 15 per cent under the U.S. and Canada tax treaty rate.

Currently, there are no imminent changes expected under the incoming U.S. administration that could impact the tax withholding rate on pension distributions for Canadian residents.

Under Canadian tax rules, the lump sum withdrawal (before U.S. withholding tax) is reported as income on your personal tax return. Timing is a factor. If the funds are withdrawn in 2024, you can transfer them to an RRSP within 60 days (e.g. by March 1, 2025) and claim an offsetting deduction equal to the amount you transferred. As a result, there would be no tax on this amount.

For example, if you were to withdraw $100,000 from a 401(k), you would receive $85,000 after $15,000 of U.S. tax withholding. On the Canadian return, you would need to include all the amounts in Canadian dollars.

You will then report $100,000 as income on your Canadian return. You have two options in order to claim a deduction: You can designate $85,000 on the tax return for a transfer to an RRSP, resulting in $15,000 of taxable income. Or, you can designate $100,000 for the transfer to the RRSP and make up the $15,000 personally, resulting in no taxable income on the transfer. The good news is that you do not need to have RRSP contribution room for this transfer. Furthermore, the U.S. withholding tax can offset Canadian tax on your other income as well.

When considering closing a U.S. retirement plan after moving back to Canada, it is important to understand whether or not this is actually the best option. You may wish to explore the option of rolling over a 401(k) to an IRA and leaving the account in the U.S.