The year is 2019. Bob and Mary Smith have been married for 30 years and have resided in Canada their entire lives. Bob is a self-employed accountant who earned $150,000 in 2019. Mary is a VP at a large toy company and earned $220,000 in 2019. Bob and Mary have two children, Max and Bob Jr. Both children have finished college and are no longer dependant on Bob and Mary. Bob was born on July 19, 1963, and Mary was born on December 14, 1964.

Bob has contributed consistently to his RRSP and has a balance of $445,000 in his personal RRSP. He also has carried forward in terms of RRSP room in the amount of $23,500.

Bob has maximized his TFSA on an annual basis. He has yet to contribute to his TFSA in 2020. The balance in Bob’s TFSA account is $97,500.

According to CRA Bob will receive $900 per month in CPP at age 65. At age 65 Bob will have contributed to CPP for 40 years.

Mary is a member of a DCPP. Her company matches her 3% contribution to this plan. Mary has also contributed to her RRSP annually. She presently has $375,000 in her RRSP and $260,000 in her DCPP.

Mary has $29,500 in RRSP carry forward.

Mary has maximized her TFSA annually and presently has a balance of $105,000 in her TFSA. She has yet to contribute to her TFSA in 2020.

According to CRA Mary will receive $1100 per month in CPP at age 65. At age 65 Mary will have contributed to CPP for 40 years.

Based on this information please provide answers to the following questions.

1. If Bob retires at age 60 and takes his CPP at age 60 how much per month in CPP will Bob receive?

2. Mary intends on working to age 67 because she loves her job. How much CPP will she receive at age 67?
3. Assume Bob and Mary decide to both retire at age 65. If they assign their CPP benefits how much will each receive in CPP? How much is Mary’s assignable portion of her CPP?
4. How much RRSP room will Bob have for 2020?

5. How much RRSP room will Mary have for 2020?
6. What is Mary’s TFSA room for 2020?
7. Should Mary contribute to a personal RRSP or a Spousal RRSP? Why?
8. At age 65 what percentage of OAS will Bob and Mary receive? Why?
9. Is Bob a good candidate for an IPP and why?

Assume Bob and Mary are both retired. The year is 2030. Assume they are both receiving $800 per month in OAS. Bob’s income in 2029 was $120,000 and Mary’s was $100,000. Bob’s income in 2030 was $125,000. Mary’s income in 2030 was $105,000. If the OAS Threshold for 2030 is $80,000 how much OAS will Bob and Mary receive?

Bob’s RRSP consists of the following investments.

Mutual Funds

Canadian Stocks

Government of Canada Bonds

Futures Commodity Contracts

Are all of these investments eligible to be part of an RRSP portfolio? If not which one(s) are ineligible?

Assume the year is 2025. Bob has retired and is now 62 years of age. As of January 1, 2025, his RRSP was valued at $530,000. Bob converted his RRSP to an RRIF at the beginning of 2025. How much is the minimum RRIF withdrawal in that year?

Mary contributed to a Spousal RRSP for Bob in 2024. The amount of that contribution was $15,000. The value in 2025 was $16,000. Bob decided to cash in the entire Spousal RRSP to buy a car. Who would pay the tax on the $16,000 withdrawal and why?

Bob and Mary had a retirement plan completed by a professional financial planner in 2019. In that plan, the advisor recommended various strategies that would allow Bob and Mary to live out their retirement in comfort and with little to worry about in terms of money. Bob and Mary are now in their mid 80’s and are starting to run out of money. They have not seen their financial advisor in 10 years. What step in the financial planning process did their advisor fail to follow?

Answer rating: 100% (QA)

Solution i If Bob retires at age 60 and takes his CPP at age 60 how much per month in CPP will Bob receive Bob will receive 590083 per month ii Mary intends on working to age 67 because she loves her ... View the full answer