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Should I take CPP at age 60?

Posted on: January 9, 2020

By Barbara Knoblach, PhD, CFP®

Mature couple walking in countryside

With every changing season or life stage, we tend to reflect and look towards the future. We hold memories close and feel excited about what is to come.

Such reflection is an opportunity to pause and remember why you work hard and to recommit to your life goals – including the important retirement goals. Who doesn’t dream of the day when all four seasons are theirs to shape and enjoy?

Retirement looks very different to everyone, and one of the most important things to consider when planning yours is the optimal time to apply for Canada Pension Plan (CPP) benefits. As well as some of our latest recommendations:

All it takes is a bit of calculated foresight to make the decision that will best suit your circumstances.

Here’s a look at some basics:

Canada Pension Plan benefits can be drawn as early as age 60 (reduced 0.6% for each month before 65) or as late as age 70 (increased 0.7% for each month after 65).

The average life expectancy for Canadians is age 80 for men and 84 for women. Statistics Canada predicts a continued rise in life expectancy of roughly two years over the next 15 years.

Things to consider:

Life expectancy

Contemplating your mortality may feel uncomfortable, but it should not be ignored. Your health and whether longevity is a family trait, are things to consider when making your decision regarding CPP.

If you take your CPP starting at age 60, your breakeven point with someone who waits until age 65 is when you both turn 74. Confused? Let me put it another way – I will use an example to illustrate my point.

If Mary takes her CPP at 60 and Brenda takes hers at 65, Mary’s monthly CPP payment will be 36% lower than Brenda’s, but she will collect five years longer. They will be 74 when Brenda pulls ahead of Mary for overall amount collected.

Continue reading →

Posted in Ask Your Money Coach, For your information


5 Retirement Pitfalls and How to Avoid Them

Posted on: December 18, 2019

By Karin Mizgala, Co-Founder and CEO Money Coaches Canada

Over the years I’ve transitioned many clients through retirement and while each story is unique, there are some commonalities in their experiences. One story that sticks with me is the reaction that my client Margaret (name has been changed) had when we went through the retirement projections which gave her the green light for retirement. Instead of jumping for joy, she burst into tears!

Initially, we were both surprised by her reaction, but it really isn’t that surprising at all. Retirement is a major life change, and what major life change comes without a mixture of excitement and fear? Margaret was elated that she had achieved her goal of a comfortable retirement, but overwhelmed by the implications of what this freedom actually meant for her and the new set of decisions she now had to make.

While we may gripe about our jobs and dream of the day when we can kick up our feet and relax, the side of us that is fulfilled by the structure and purpose of our work may feel overwhelmed by the responsibility of deciding what comes next. The cage is open, yet we may be afraid to fly out into the unknown. Continue reading →

Posted in Money Coaching


Make the Most of the Holiday Season

Posted on: December 3, 2019

financial well being

Don’t let this holiday season hurt your financial well being. Stay on track and enjoy the season without the stress of putting your financial future in jeopardy.

To help, we’ve assembled our most popular holiday-themed articles in one place. Each is a quick read and will give you great tips and strategies to enjoy the best of the holiday season without adding financial stress.

Continue reading →

Posted in Budgeting and Cash Flow, Money Coaching


Money Makeover – High Income Couple Out of Debt and Ready for Retirement

Posted on: November 20, 2019

By Christine Williston, B.A., CFP®, Money Coach

 

Meet Melanie and Brian

When I met Melanie and Brian (names have been changed for privacy), Brian was 50 years old and Melanie was 42. Both had high power, high paying corporate jobs that kept them very busy. What free time they had, they devoted to their two children ages 13 and 14. Their income was almost half-a-million dollars a year, but without the time or expertise to maximize their financial situation, they found themselves in debt and worried about retirement. Continue reading →

Posted in Debt, Money Coaching, Money Makeover, Success Stories


Investments Plain and Simple

Posted on: September 5, 2019

How Investments Are Taxed

When making investment decisions, it is wise to consider the various tax implications – both positive and negative. As always, first remember that your investments should reflect your goals and values, your time frame and your risk tolerance. It’s vitally important to remember that though tax advantages can change with the government, investment decisions should only change with life considerations.

Here are some important guidelines on how investments are taxed for you to keep in mind:

Pension

Registered Investments (RSPs & Pensions):
These are not taxed until you remove money from your registered investment. You will then be taxed at the rate applicable on your income at withdrawal, which is usually at a lower rate at retirement than when you were working.  You also get a tax deduction when you contribute to a registered investment.

Continue reading →

Posted in Financial Literacy, Investing, Retirement savings, taxes


Do You Have What It Takes To Be An Entrepreneur?

Posted on: August 21, 2019

By Karin Mizgala, Co-Founder and CEO Money Coaches Canada

Starting your own business is easier than it has ever been before. The internet has made it possible to serve customers not only across the country, but across the world. Accessible technologies have made it conceivable to create an app, bring a product or service to market, be a consultant or teach courses.

Entrepenaur Canada

This exciting new path to entrepreneurship has no age barriers either; kids are pitching viable ideas to savvy investors on the television show Dragon’s Den; millennials have been nicknamed the side-hustle generation; and businesses started by baby boomers with no interest in retirement, are on the rise.

But what will make any of these new businesses successful is not an internet connection and a large Twitter following. Today’s entrepreneurs need the same mindset and success principles that Canadian J.L. Kraft had when he started selling cheese out of a horse-drawn wagon in 1903.

Let’s look at what draws people to entrepreneurship and what needs to be considered before taking the leap. Continue reading →

Posted in Money Coaching, Small Business


Don’t Let Back to School Break the Bank

Posted on: August 7, 2019

By Sheila Walkington, BBA, CFP® 

The back to school cliché is that kids dread it and parents are gleefully counting the hours. But in reality, lots of kids are excited to go back to school (albeit an excitement that usually fades with the first homework assignment) and many parents dread September because it feels like open season on their bank accounts. Back to school spending seems to escalate every year, but it doesn’t have to be that way. You may not be able to keep your kids excited about school, but saving on back to school expenses is possible with some planning.

Back to school basics

Continue reading →

Posted in Budgeting and Cash Flow, Money Coaching


Embrace Aging and Plan for a Happy Retirement

Posted on: July 24, 2019

How We Age is Changing

As youngsters, we can’t wait to get older.  Sometime later, we become less enthusiastic about our next birthday.  We come to realize our mortality with the tick-tock of age.  It’s a matter of perspective.

Age has also changed in perspective over history.  For much of human history, the toil of daily work didn’t stop until health failed or death.  Retirement didn’t exist.  Caring for the elderly was short-lived if at all.  When Benjamin Franklin uttered his famous quote: “Nothing can be certain, except, death and taxes”, the average longevity was just 35 with almost nobody reaching age 60.  It would be the 20th century before average longevity creeped up to 50.  With modern breakthroughs in health care and eradication of diseases, average longevity has surged to 85 today with many reaching 100.  Aging isn’t gone but we have the opportunity to stay with it longer. Continue reading →

Posted in Relationship to money, Retirement savings


Second Time Around? 5 Things You Need to Know about Marriage and Money

Posted on: July 17, 2019

By Karin Mizgala, Co-Founder and CEO Money Coaches Canada

Almost thirty-five per cent of married Canadians are married for the second or even third time. And while it would be nice to believe that the experience of divorce improves chances for a subsequent marriage, statistics don’t bear that out. Financial issues—the cause of many a marital breakdown—may have something to do with that.

The good news; with joint planning and consistent communication, you can address the array of new money concerns that come with a second marriage; and avoid the financial resentments, anger and misunderstandings that can undermine any couple’s relationship.

Here are 5 areas to consider: Continue reading →

Posted in Budgeting and Cash Flow, Money Coaching, Relationship to money, Retirement savings, Will & Estate Planning


Podcast: Get a Second Opinion with the Investment Report Card

Posted on: July 5, 2019

Bruce Sellery of Moolala recently spoke with our own Karin Mizgala, co-founder of Money Coaches Canada, about the On Your Side Investment Report Card™ service and why Canadians should get a second opinion on their investment portfolio.

The On Your Side Investment Report Card provides answers to some of the most important questions investors have about their portfolio, including:

  • How do I get started with building an investment portfolio?
  • Is my investment portfolio performing as well as it should?
  • Do I have the right investment strategy for my goals and needs?
  • Am I paying too much in investment fees?
  • What should I do to get my investments on track?

The answer to these questions – and many more – is an unbiased and independent second opinion. That’s why we created the On Your Side Investment Report Card.

Please click on the recording below to listen to the Moolala Money Made Simple podcast about the Investment Report Card. (running time approximately 11 minutes).

Learn more about the On Your Side Investment Report Card.

Posted in Investing


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