Pension income splitting versus spousal RRSPs

PENSION INCOME SPLITTING CAN BE A GREAT WAY to reduce taxes.  Couples can split their income once their Registered Retirement Savings Plans (RRSPs) become Registered Retirement Income Funds (RRIFs).  The rules allow a pensioner to transfer up to one half of his or her eligible pension income to a spouse.  Sounds great, right?  So why keep that spousal RRSP? Spousal RRSPs may still offer some advantages, particularly if one spouse earns significantly more income than the other.

Income splitting with a RRIF

Under the pension income splitting rules, you must be at least age 65 and convert your RRSP into a RRIF in order to split income.  Regular RRSP withdrawals do not qualify for pension income splitting.  For people who retire early, a spousal RRSP provides more flexibility.  This is because you choose how much to contribute to the spousal RRSP, which has the potential to equalize retirement income and save taxes.

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The top 5 RRSP mistakes and how to avoid them

by Chad Fraser

We asked a certified financial planner to reveal the most common RRSP mistakes he sees – and to suggest simple tips to help steer clear of them.

It’s a time-honoured ritual: In the first 60 days of the year, people across Canada gather up as much spare cash as they can, then dash to contribute to their registered retirement savings plans (RRSP) before the annual deadline hits.

There’s good reason to circle the cut-off date (it falls on March 1 in 2018): It’s your last chance to make a contribution that’s deductible against your income – thereby lowering your tax bill – from the previous tax year.

That tax deduction is just one of many benefits RRSPs offer.

Another? Tax deferral: Investments you hold inside your RRSP grow tax-free. And when you start taking your money out, after you’ve retired and converted your plan to a registered retirement income fund (RRIF), or used it to purchase an annuity, it’s taxed at your rate at the time of withdrawal, which should be lower than in your working years.

Sounds simple, right?

The truth is people still make plenty of blunders with their RRSPs. Today we’ll help you avoid 5 of the most common ones, with tips from Cliff Steele, a certified financial planner with Sun Life Financial.1

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Tips for buying travel insurance

by Joy Blenman

You may be in perfect health, or just going away for a day or 2.  But accidents can happen.  Here’s what you need to know about buying travel insurance.

Imagine you’re on vacation in the Caribbean.  The sun is warm, the water that surrounds you is a vibrant blue and the landscape is lush.  You’re in a picture-perfect paradise.  But suddenly, you begin to feel ill.  When you can’t shake it off, you decide to go to the local doctor, who treats you and assures you that you’ll feel better soon.  But then you feel worse, because as you leave the office, you get a hefty medical bill.

Nobody wants to pay for added expenses after splurging on a vacation, but a trip to the hospital overseas could leave you on the hook for a medical bill in the thousands or even tens of thousands of dollars.  Each year, there are countless headlines about Canadians who’ve run up exorbitant medical bills while on vacation without travel insurance.  Even a quick jaunt across the border to shop or catch a ballgame carries the risk of a crippling expense – and while your provincial health insurance may reimburse you for a small portion of the cost, your coverage is capped at the provincial fee limits for the treatment you received, if that treatment is covered at all.

And yet, only 47% of Canadians “always purchase travel insurance” before taking a trip, according to a 2014 Travel Health Insurance Association of Canada survey.

So why are so few of us insuring ourselves when we travel?  Insurance terms can seem complicated, but a good insurance provider will clarify what the jargon means and make getting insured a smooth process.

How to pick a good travel insurance provider

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How to cure a holiday debt hangover

By Anne Levy-Ward

Has too much seasonal spending left you with an aching wallet?  These tips will help ease the pain – and prevent it from happening again.

Ah, January!  That wonderful month for football, fresh starts and frightening credit card bills.

“Psychologically, shopping gives many people a lot of pleasure,” writes Sarah Milton in the retirehappy blog.  “There’s something quite festive about wandering around in a warm, well-lit space when it’s freezing cold outside while we pick out gifts for those we care about.  The trouble is, that the nice warm space and generous mindset often lead to us spending far more than we intended to.”

If overdoing your holiday spending has left you with a raging debt hangover, here are some smart ways to treat it now and keep out of trouble next time.

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What should you include in your 10-year farm plan?

Ensuring all members of the farm operation are on the same page is critical to business success

When planning for the future of your farm, it’s important to look a decade ahead; according to Rick Dehod, a farm financial specialist with Alberta Agriculture and Forestry.

“Farmers often say they haven’t had a chance to work on their 10-year plan,” he told Call of the Land today.  “Whether the next generation is ready to take over or you’re in the prime of your farming career, you need to ask yourself what the farm business will look like 10 years from now.”

When putting together a 10-year plan, it should include three key elements, Dehod said.

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New Years Resolution – Be Healthier

Celebrate your healthy success with Manulife Vitality.  When you live a healthy lifestyle, you can earn Vitality Points.  The more points you earn, the higher your Vitality Status and the greater your potential rewards and discounts.  Members can easily access rewards through

Watch this 2 minute video for details



4 financial gift ideas for kids

Make finances festive:  Instead of giving kids cash or gifts that will wear out, break or be outgrown, why not set it up so your gift keeps giving?

It’s easy to succumb to the latest cool, shiny toys when shopping for the children in your life – especially during the festive time of year.  Or you might be tempted to give your children or grandchildren cash, instead of battling it out in the mail or hunting for the perfect gift online.  But with a little thought, you can help the young people you love invest for the long term.

Here are a few ideas for financial gifts:

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4 ways to make the most of charitable donations

Do you want to use your money to make a difference?  Here are 4 easy ways to ensure you and your favourite charity get the most bang for your buck.

Charitable giving is on the rise.  In fact, according to Statistics Canada, more than 80% of Canadians 15 years of age or older donated to their favourite causes in 2013, doling out $12.8 billion in total – almost a quarter more than in 2004.

If you’re looking to join or become a bigger part of that growing trend, but also want to be sure you’re maximizing your impact, the following 4 tips can help:

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6 ways to avoid overspending during the holidays

It’s crunch-time for the yearly shopping spree, and your wallet may be feeling the pinch.  Here are some easy ways to free up more money – and time.

As the days on the calendar tick down and the mall crowds grow heavier and heavier, it can be easy to get caught up in the festive frenzy and go over your holiday shopping budget.  A study by RBC found that 51% of respondents went beyond their holiday budgets in 2016, up from 41% in 2015.

  • How to manage holiday stress

The good news is there are simple ways to save cash – and time – during the holidays.  Here are 6 tips from Scott Hannah, president of the non-profit Credit Counselling Society.

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Critical Illness

If you needed to take time off work to recover from a critical illness, what funds do you have in place to replace your lost income?


Take a look at this short video to see how critical illness insurance helped people like you.

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