1. John and Jane are planning to buy a house. Here is what John said:

I have $35,000 in my registered retirement savings plan. My spouse has no RRSP. I have roughly $60,000 in unused contribution room. We are planning on using the first-time Home Buyers’ Plan for my RRSP. My income is $80,000, my partners’ income is $35,000. We have over $50,000 in a joint savings account. Can I use $35,000 of that savings and put it into a spousal RRSP so that we can use the $35,000 from my own RRSP plus the $35,000 in the spousal RRSP? What’s the catch?

2. At age 90, Dorothy is more physically active than some much younger people, hiking, skiing and boating over the trails and lakes of her rural Ontario home. She feels she could live to be 105 – so no wonder she worries about running out of money.

When her husband died a few years ago, he left Irene his defined benefit pension plus a stock portfolio that had risen substantially in value. But when her husband’s long-time broker retired, Dorothy was adrift, her account transferred to a stranger in Toronto. Now, with almost half of her $1.8-million portfolio sitting in her bank account, Dorothy is looking for advice on investments, tax planning and estate planning.

“She has no one advising her on any of her accounts,” her daughter Milly writes in an e-mail. “She wants to find the right balance for her age between simplicity and safety.”

Dorothy’s problem – not a bad one to have – is the substantial unrealized capital gain in her portfolio, which would trigger a big tax bill if she sells. She’s thinking of giving each of her three children an advance on their 

inheritance “to lessen the tax burden in settling her estate” when she eventually dies.
Dorothy $29,000 a year in pension income, $11,700 in Canada Pension Plan benefits and $7,400 in Old Age Security, for a total of $48,100 before tax, indexed to inflation.

Answer rating: 100% (QA)

1 The Home Buyers Plan allows Canadians to take money out of their RRSP taxfree to buy or build a ho... View the full answer