Ron and Janice Mawson are now both 55 years old but Ron was disabled for eight years
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Question:
They currently have no liabilities other than the mortgage and they continue to invest in their RRSPs on a monthly basis. Ron has grown his RRSP to $300,000 and Janice has $350,000 in her RRSP. They each contribute $800 per month to these plans and will continue to do so until their planned retirement at age 65. These registered plans are currently invested 30% income and 70% equity."
And these are the questions:
Assuming 6% annual compound growth, what will the value of Ron and Janice's RRSPs be at age 65? Show these amounts separately for both Ron and Janice. (4 Marks)
If they leave their asset allocation the same and continue to earn 6% per year what income could they each pay themselves from these plans at age 65 without encroaching on capital? Assume a 5% withdrawal rate. (4 Marks)
If they convert their RRSPs to a RRIF what is the minimum payment required based on their age 65? What is the minimum if they wait to withdraw the funds at age 72?
Related Book For
Income Tax Fundamentals 2013
ISBN: 9781285586618
31st Edition
Authors: Gerald E. Whittenburg, Martha Altus Buller, Steven L Gill
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