People often forget that there are two sides to the equation. One needs an income but one also needs to keep spending under control. Sounds simple but in reality it takes a bit of planning and discipline.
I am 60 and I grabbed my CPP asap. Who knows how long I still have to live? And that missed money is not transferable to the kids. It is lost forever (not for everybody). If you don't need it, just invest it in your TFSA.
Everyone has a different take on it. If you aren't still working and in a high tax bracket and have room to invest it in your TFSA it is definitely an option.
I had to leave the Army early for medical ( quite common actually) so my pension is not that great but my attitude is that if someone showed up every month and gave you $100 but free, would you be mad and punch him in the mouth?? So if CPP shows up with a greatly reduced 50% of say $450 and OAS $700, that's essentially free money. I know I worked and paid for it but thats in the past, thanks for the cash!!
Depends on how you frame it. OAS you could definitely say is free money but not so much CPP, that's your hard earned dollars. Every case is situational but the majority of healthy individuals would probably end up better off delaying.
it isn't free money!.. it is your money that has been invested for you! and the CPPIB has does a great job.. let them continue... OAS comes out of general revenues and thus the reason for the age of 65... if you can, defer both to at least 67/68 or 70.
2 things come to my mind , 1 ) where can you live in today’s economy for $2700 / month? If this was a 5 yr or older story I might have been more agreeable but not in Canadas present day costs of living and 2) are you a gambler? Like playing the odds? Look at your family history, it may give you an insight to how long you might live. It would be nice to live past 80 and draw both those government pensions for 10 years or more but if you live to 69 you got nothing back from all the working years you contributed. The saying goes” a bird in the hand is worth 2 in the bush” is true to all my accounts. If I live to 72 to get the max this story indicated I would have received something for 12 years and now at 72 it equalizes. If I live go 80 , 20 years of collecting, 12 indexed at a lower rate and 8 at maximum,indexed
@buffystclair9042 .... Although I agree with you on point 1, I am not sure what it has to do with this video? I also agree with you on family history. Looking at family history as well as your own health is huge. Having a good family history and good health is very different decision from a poor family history and poor health.
It's all situational and depends largely on health, current needs, sources of income and tolerance for risk. CPP and OAS decisions should be part of an overall retirement plan and not singular decisions. That said, a healthy 60 year old will probably end up with more dollars over the long run by delaying.
@@marionsutcliffe1119 Can’t give your kids your CPP and OAS when the inevitable happens. It’s also about the quality of the money…not the quantity. Who cares how much income I have when all I’m doing is getting my butt wiped for me. I’ll take it now and go on those extra trips and cruise’s while I can or just go out for weekly steak dinners with my wife…while we’re both here.
I agree, if I live to be 90 I'm sure I could have more fun with that extra money when I'm 63 rather than 83. Most people also kick off in their 70's in my family so, I know what my plan is.
Totally wrong always take CPP at 60 and invest all that money like you don’t have it and by 65 you will have a nice extra nest egg waiting for ya! Get a part time job for income and to have purpose everyday when you retire. Sit and do nothing and life will end prematurely!
Not totally wrong, but not totally right either. Everyone has a different and unique circumstance. I'm taking CPP at 61. Why?. Because I have a Defined Benefit Pension with a bridge until 65. In those 4 years ill collect $40,000. Or 10 k a year. I can use that money for my TFSA, high interest savings account or just spend it. It also means that I can be less dependent on my own money ( RRSPs). When my bridge Benefit drops off at 65 OAS kicks in. OAS plus CPP actually put me ahead of what I get now. In fact I'll be $6000/ year ahead. To get to $ 6 k ahead I would have to wait until 68 for my CPP to make up that yearly amount. But I would have collected $70,000 by then by starting at 61. By getting less CPP for longer I will also avoid OAS clawback.
@AMTTBT I respectfully disagree that you should always take CPP at 60. If you are going to invest it then there is an argument to be made but most people don't. I have seen more times than I can count people taking it at 60 and spending it while in a marginal tax bracket of 40% or 50%. As @garth217 has pointed out, it is all situational.
Certainly over the last 15 years you would have. The 10 years before that, not so much. Going back further than that, it would be a much tighter spread.
It’s only a boneheaded move if a) he didn’t enjoy using the early funds b) he didn’t need the $ c) he dies at a ripe old age. Even with c) it’s still a financial issue. If he takes the money and every month enjoys the use of it, who are we to judge? Just sayin.
@@Imsosmrt1999 You are right, it is all situational at the end of the day. There are a number of factors at play. Hopefully he at least enjoyed spending the funds early.
CPP is a bad investment. The contributions would have returned more in and ETF and you would still have the principal. Take CPP as soon as you can as a dollar now is a dollar you can invest. A dollar in the future is $0.70. look at whats happened in the last couple years. Governments cant help themselves but devalue the the currency.
Respectfully disagree. If you have the discipline and tolerance for risk then yes this might work out for you but the majority of folks do not, hence why they should not be dismissing CPP.
@@beachesfinancialgroup I totally agree with you. Guaranteed funds from any source cannot be ignored. Also, from my experience the self discipline to stay the course and deny wants to focus on today's needs and the future's security is rare. The part that anger's me most is that the return on my and my employer's contribution is so paltry after so many years and like a number of entitlement programmes is more redistributive than is ever admitted, nor is is properly accounted for in public.
@@beachesfinancialgroup Agreed, the hypothetical $40K that two 65 year old full-CPP and OAS earners could collect is material. US contribution tax rates for employees and employers are very similar to ours but the payback to US citizens is an order of magnitude better. It's not even remotely comparable. Sure, you can argue that the US SS system is "bankrupt" but of course our entire country is bankrupt; our vast quantities of debt will never be repaid and is devaluing our currency and inflating our costs every day. The only country that matters that could "pay back it's debt" is the US. Period. In isolation, CPP "looks solvent" but this is really an illusion in a country that is terminally indebted and could not ever repay it's debts. I'm past all of this and immune financially. It makes little difference to me. It makes a huge difference to my kids. I urge them and everyone's kids to consider a full range of options to make their futures better.
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Great info...
I took my CPP at 60, and invest it every month. Works great so far...
There are some folks that do that and depending on the sort of returns you end up getting it can be a strategy that works out well over the long run.
@@beachesfinancialgroup
Yes, it has been working very well.
I just got my first CPP payment. 50% went into my TFSA. That's $20,000 extra that will go into my investments in 4 years
People often forget that there are two sides to the equation. One needs an income but one also needs to keep spending under control. Sounds simple but in reality it takes a bit of planning and discipline.
Very true, if you don't have your spending under control it can be very difficult.
Outstanding retirement advice! ✅
Thank you sir, have a great thanksgiving weekend!
Thanks ! Great information!
Thank you, glad you enjoyed it!
I am 60 and I grabbed my CPP asap. Who knows how long I still have to live? And that missed money is not transferable to the kids. It is lost forever (not for everybody). If you don't need it, just invest it in your TFSA.
Everyone has a different take on it. If you aren't still working and in a high tax bracket and have room to invest it in your TFSA it is definitely an option.
I had to leave the Army early for medical ( quite common actually) so my pension is not that great but my attitude is that if someone showed up every month and gave you $100 but free, would you be mad and punch him in the mouth?? So if CPP shows up with a greatly reduced 50% of say $450 and OAS $700, that's essentially free money. I know I worked and paid for it but thats in the past, thanks for the cash!!
Depends on how you frame it. OAS you could definitely say is free money but not so much CPP, that's your hard earned dollars. Every case is situational but the majority of healthy individuals would probably end up better off delaying.
it isn't free money!.. it is your money that has been invested for you! and the CPPIB has does a great job.. let them continue... OAS comes out of general revenues and thus the reason for the age of 65... if you can, defer both to at least 67/68 or 70.
@sholbech22 no thank you I'm good
Are the annuities indexed, though?
A 2% annual increase was factored in. If you wanted higher then the cost of the annuity would be higher.
My bad. It was meant to be a response to a woman whose sister died at 71 after delaying CPP to age 70.
I thought it was probably meant to go there, very tragic.
2 things come to my mind , 1 ) where can you live in today’s economy for $2700 / month? If this was a 5 yr or older story I might have been more agreeable but not in Canadas present day costs of living and 2) are you a gambler? Like playing the odds? Look at your family history, it may give you an insight to how long you might live. It would be nice to live past 80 and draw both those government pensions for 10 years or more but if you live to 69 you got nothing back from all the working years you contributed. The saying goes” a bird in the hand is worth 2 in the bush” is true to all my accounts. If I live to 72 to get the max this story indicated I would have received something for 12 years and now at 72 it equalizes. If I live go 80 , 20 years of collecting, 12 indexed at a lower rate and 8 at maximum,indexed
@buffystclair9042 .... Although I agree with you on point 1, I am not sure what it has to do with this video? I also agree with you on family history. Looking at family history as well as your own health is huge. Having a good family history and good health is very different decision from a poor family history and poor health.
I still don't understand the logic of waiting until I'm too old to enjoy my money in order to get more money.
Spend and enjoy your own money first. Then enjoy CPP and OAS plus the remainder of your own money.
It's all situational and depends largely on health, current needs, sources of income and tolerance for risk. CPP and OAS decisions should be part of an overall retirement plan and not singular decisions. That said, a healthy 60 year old will probably end up with more dollars over the long run by delaying.
@@marionsutcliffe1119 Can’t give your kids your CPP and OAS when the inevitable happens. It’s also about the quality of the money…not the quantity. Who cares how much income I have when all I’m doing is getting my butt wiped for me. I’ll take it now and go on those extra trips and cruise’s while I can or just go out for weekly steak dinners with my wife…while we’re both here.
I agree, if I live to be 90 I'm sure I could have more fun with that extra money when I'm 63 rather than 83. Most people also kick off in their 70's in my family so, I know what my plan is.
@@brianbee I have enough money already. I'm with you. I'm not taking the chance as I don't expect to see 80 either.
Totally wrong always take CPP at 60 and invest all that money like you don’t have it and by 65 you will have a nice extra nest egg waiting for ya! Get a part time job for income and to have purpose everyday when you retire. Sit and do nothing and life will end prematurely!
Not totally wrong, but not totally right either. Everyone has a different and unique circumstance. I'm taking CPP at 61. Why?. Because I have a Defined Benefit Pension with a bridge until 65. In those 4 years ill collect $40,000. Or 10 k a year. I can use that money for my TFSA, high interest savings account or just spend it. It also means that I can be less dependent on my own money ( RRSPs). When my bridge Benefit drops off at 65 OAS kicks in. OAS plus CPP actually put me ahead of what I get now. In fact I'll be $6000/ year ahead. To get to $ 6 k ahead I would have to wait until 68 for my CPP to make up that yearly amount. But I would have collected $70,000 by then by starting at 61. By getting less CPP for longer I will also avoid OAS clawback.
@AMTTBT I respectfully disagree that you should always take CPP at 60. If you are going to invest it then there is an argument to be made but most people don't. I have seen more times than I can count people taking it at 60 and spending it while in a marginal tax bracket of 40% or 50%. As @garth217 has pointed out, it is all situational.
We'd do much better just dumping what they dumped in CPP into the S&P500, mathematically speaking.
Certainly over the last 15 years you would have. The 10 years before that, not so much. Going back further than that, it would be a much tighter spread.
That’s a tragedy no doubt.
I think this came in as a standalone comment, was it meant to be attached to a thread?
BS - who guaranty you that you will NOT die at 50-60-69 ???
Nobody but statistically speaking if you are healthy chances of you living past that are higher than not.
I brother in law took CPP at 60 because he could not because he consulted an expert. He’s now 66 and very healthy. Bonehead move.
That's a shame. It's all situational but the majority of healthy individuals would be better off delaying.
@@robertross8565 Agreed!
It’s only a boneheaded move if a) he didn’t enjoy using the early funds b) he didn’t need the $ c) he dies at a ripe old age.
Even with c) it’s still a financial issue. If he takes the money and every month enjoys the use of it, who are we to judge? Just sayin.
@@Imsosmrt1999 You are right, it is all situational at the end of the day. There are a number of factors at play. Hopefully he at least enjoyed spending the funds early.
If you take it early break even is at 75 years old. How many live past that? Do the math.
CPP is a bad investment. The contributions would have returned more in and ETF and you would still have the principal. Take CPP as soon as you can as a dollar now is a dollar you can invest. A dollar in the future is $0.70. look at whats happened in the last couple years. Governments cant help themselves but devalue the the currency.
Respectfully disagree. If you have the discipline and tolerance for risk then yes this might work out for you but the majority of folks do not, hence why they should not be dismissing CPP.
@@beachesfinancialgroup I totally agree with you. Guaranteed funds from any source cannot be ignored. Also, from my experience the self discipline to stay the course and deny wants to focus on today's needs and the future's security is rare. The part that anger's me most is that the return on my and my employer's contribution is so paltry after so many years and like a number of entitlement programmes is more redistributive than is ever admitted, nor is is properly accounted for in public.
That is a very fair point. There is a lot that goes into CPP each year and pretty much zero flexibility on what happens to those funds.
@@markbernier8434 . the CPPIB invested hard earned funds from Canadian's into alternative crypto investment and lost those investments...
Most people would have spent the money and nothing to show for it
Pathetic Canadian benefits.
It's not perfect but for the vast majority of people it is far from "Pathetic"
@@beachesfinancialgroup Agreed, the hypothetical $40K that two 65 year old full-CPP and OAS earners could collect is material.
US contribution tax rates for employees and employers are very similar to ours but the payback to US citizens is an order of magnitude better. It's not even remotely comparable.
Sure, you can argue that the US SS system is "bankrupt" but of course our entire country is bankrupt; our vast quantities of debt will never be repaid and is devaluing our currency and inflating our costs every day.
The only country that matters that could "pay back it's debt" is the US. Period.
In isolation, CPP "looks solvent" but this is really an illusion in a country that is terminally indebted and could not ever repay it's debts.
I'm past all of this and immune financially. It makes little difference to me. It makes a huge difference to my kids. I urge them and everyone's kids to consider a full range of options to make their futures better.