My question is: Canadian-specific
QUESTION: Dear Sir,
I am 43 years old.I have a company retirement plan that contributes 50% of
RRSP each year.I have RRSPs that can pay off 85% of my mortgage if cahsed
out. Is it a good idea to cash out RRSPs and pay off the mortgage and
restart with RRSP when I have enough cash? Or may be buy a rental property?
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david ingram replies:
This is the first question I have answered in two weeks after being away.
Came home to over 200 questions so will answer five or six and dump the
rest. If you do not find an answer, try again or search the centa site at
www.centa.com
There is a free seminar on making mortgage interest deductible tomorrow
night in Vancouver if you are in the lower mainland of BC. In fact, we do
the seminar every Thursday Night - details at the end-
In general, I do NOT recommend cashing in an RRSP and paying the tax to pay
off a mortgage unless you are prepared to go out right away and do a
leveraged plan to bring our retirement plan back up to its previous
strength.
By this i mean that if you pay off $100,000 of mortgage, you should
immediately use the new equity in the home to borrow an equivalent amount to
invest in an URSP (Unregistered Retirement Savings Plan). This will give
you the advantages of keeping the dividend tax credit and more favourable
tax treatment of Capital gains which are both lost when securities are held
inside of a Registered Retirement savings Plan.
You can also listen to and phone in to Fred Snyder's Sunday morning Radio
Program that I usually guest on.
Goto www.centa.com and read the November 2001 newsletter on making your
mortgage interest deductible. You can also get hold of Fraser Smith's the
Smith Manoeuvre.
Answers to this and other similar questions can be obtained free on Air
every Sunday morning.
Every Sunday at 9:00 AM on 600AM in Vancouver, I, david ingram am a
permanent guest on Fred Snyder of Dundee Wealth Managers' LIVE talk show
called "ITS YOUR MONEY"
Those outside of the Lower Mainland will be able to listen on the internet
at
www.600AM.com <http://www.600am.com/>
Call (604) 280-0600 to have your question answered. BC listeners can also
call 1-866-778-0600.
Callers to the show and questioners on this board can also attend the
Thursday Night seminars on finance and making your Canadian Mortgage
Interest deductible.
Every Thursday Evening, Fred Snyder of Dundee Wealth Management conducts one
of 17 different financial seminars at his office
Time: 7:00 to 9:30 PM
Date: Every Thursday evening
Place 1764 West Seventh
Vancouver (corner of Burrard)
Phone (604) 731-8900 to register
No cost - no obligation
Topics always cover mortgage interest as a deduction
other topics - getting the mortgage, estate planning, critical care
insurance, income taxation, differences between stocks and bonds, and
usually the most innovative HELOC mortgage offered in Canada from Manulife
Bank
David Ingram's US/Canada Services
US / Canada / Mexico tax, Immigration and working Visa Specialists
US / Canada Real Estate Specialists
Home office at:
4466 Prospect Road
North Vancouver, BC, CANADA, V7N 3L7
Cell (604) 657-8451 -
(604) 980-0321 Fax (604) 980-0325
Calls welcomed from 9 AM to 9 PM 7 days a week (please do not fax or phone
outside of those hours as this is a home office)
email to taxman at centa.com <mailto:taxman at centa.com>
www.centa.com <http://www.centa.com/> www.david-ingram.com
<http://www.david-ingram.com/>
Disclaimer: This question has been answered without detailed information or
consultation and is to be regarded only as general comment. Nothing in
this message is or should be construed as advice in any particular
circumstances. No contract exists between the reader and the author and any
and all non-contractual duties are expressly denied. All readers should
obtain formal advice from a competent and appropriately qualified legal
practitioner or tax specialist in connection with personal or business
affairs such as at www.centa.com <http://www.centa.com> . If you forward
this message, this disclaimer must be included."
Be ALERT, the world needs more "lerts"
This from "ask an income tax and immigration expert" from www.centa.com
<http://www.centa.com/> or www.jurock.com <http://www.jurock.com/> or
www.featureweb.com <http://www.featureweb.com/> . David Ingram deals on a
daily basis with expatriate tax returns with:
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San Antonio and Houston Texas
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Tips, Income Tax and Immigration Wizard Income Tax and Immigration Guru
Income Tax and Immigration Consultant Income Tax and Immigration Specialist
Section 216(4) 216(1) NR6 NR-6 NR 6 Non-Resident Real Estate tax specialist
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and Dallas Houston Rockwall Garland
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Truro, Atlanta, Charleston, San Francisco, Los Angeles, San Diego,
Sacramento, Taos, Grand Canyon, Reno, Las Vegas, Phoenix, Sun City, Tulsa,
Monteray, Carmel, Morgantown, Bemidji, Sandpointe, Pocatello, Bellingham,
Custer, Grand Forks, Lead, Rapid City, Mitchell, Kansas City, Lawrence,
Houston, Albany, Framingham, Cambridge, London, Paris, Prince George, Prince
Rupert, Whitehorse, Anchorage, Fairbanks, Frankfurt, The Hague, Lisbon,
Madrid, Atlanta, Myrtle Beach, Key West, Cape Coral, Fort Meyers, Berlin,
Warsaw, Auckland, Wellington, Honolulu, Maui, Kuwait, Molokai, Beijing,
Shanghai, Tokyo, Manilla, Kent, Winnipeg, Saskatoon, Regina, Red Deer, Olds,
Medicine Hat, Lethbridge, Moose Jaw, Brandon, Portage La Prairie, Davidson,
Craik, Edmonton, Calgary, Victoria, Vancouver, Burnaby, Surrey, Edinburgh,
Dublin, Belfast, Glasgow, Copenhagen, Oslo, Munich, Sydney, Nanaimo,
Brisbane, Melbourne, Darwin, Perth, Athens, Rome, Berne, Zurich, Kyoto,
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Truro, Charlottetown, Summerside, Niagara Falls, Albany STAR WARS
ask international income tax & immigration expert consultant david ingram
from North Vancouver, BC, Canada experts on RRSP RESP IRA 401(K) radio CKBD
600AM 9 AM Sunday mornings on Fred Snyder's IT's YOUR MONEY
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