52 Ways to Wreck Your Retirement by Tina Di Vito

Author:Tina Di Vito
Language: eng
Format: epub
Publisher: Wiley
Published: 2011-11-25T05:00:00+00:00

minimizing the size of withdrawals

If you find that your RRIF withdrawal is more than you need, you have one of two choices: take an in-kind withdrawal or find a younger spouse or partner. An in-kind withdrawal allows you to take the investments out of your RRIF “as is,” so you don't have to sell your investments — so if your RRIF is in stocks, you can continue to own the same stocks, but outside the tax-protected environment of the RRIF. Unfortunately, you will still have to pay the tax on the withdrawal. On the other hand, if you have a younger spouse, then you can base your required minimum withdrawals on the younger person's age. So if you were 75 years old but had a 70-year-old spouse, the minimum withdrawal from your RRIF could be based on your younger spouse's age — the minimum withdrawal based on your age would be 7.85%, versus 5% for a person five years younger. The younger your spouse, the lower the minimum withdrawal percentage. This allows you to keep more of your money in a tax-deferred plan for a longer period of time. Who says there's no tax advantage to having a younger spouse?

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