Retirement and Estate Planning in Canada, 3e

Coleen Clark     

Captus Press, ISBN 978-1-55322-289-7 (2013)
558 pages, 1020 g, 8.5 X 11, $64.50 (US$51.50)
 

Fully updated, Retirement and Estate Planning in Canada, 3e provides a detailed examination of both retirement and estate planning. The first part of the book deals with both the financial decisions that individuals must make to prepare for their retirement as well as the actions they will need to consider once they are in retirement. Beginning with a review of the factors that affect these financial decisions (personal taxation, in particular), Part I focuses on the critical topics of government-sponsored pension plans, employer-sponsored pension plans, Registered Retirement Savings Plans and Retirement Income Options. Understanding these topics is essential for readers planning for their retirement.

 

Part II looks at the issues that surround estate planning — the process of distributing family assets in an orderly and tax-efficient manner. In addition to explaining the importance of estate planning and knowing how to build an estate, issues discussed within this part include wills, family law and power of attorney, taxation at death, trusts and donations to charity.

 

Part III rounds out Retirement and Estate Planning in Canada, 3e with complete lists of acronyms, formulas, and glossaries. To enrich learning and enhance the application of concepts and principles to real-life situations, throughout the book, readers will follow Margot and Craig, a fictional but typical family, as they go through the retirement and estate planning process. The realistic situations and decisions facing Margot and Craig within their family life cycle introduce readers to retirement and estate planning in a logical way.

Table of Contents   top

Preface

Introduction

Part 1. Retirement Planning

Part 2. Estate Planning.

Part 3. Appendices

Margot and Craig and Others

 

1 Retirement Planning

 

1 The Retirement Planning Process

Introduction

A. The Planning Model

B. Implementing the Process

Summary

Margot and Craig

Key Terms

Questions and Problems

Appendix 1A: Review of Time Value of Money

 

 

2 Factors Affecting Retirement Planning .

Introduction

A. Longevity

B. Inflation

C. Rates of Return

D. Income Tax

Summary

Discounting and Compounding Rules

Sources — Taxation

Key Terms

Questions and Problems

Appendix 2A: Review of Investment Basics

Appendix 2B: Taxation for Provinces and Territories

 

3 Government Pension Plans

A. Introduction to Canada’s Retirement

Income System

B. Canada Pension Plan (CPP)

C. Old Age Security Program (OAS)

D. Taxation of CPP Contributions

and Retirement Pension

E. Effect of Government Pensions on Retirement

Savings Required

Summary

Sources

Key Terms

Questions and Problems

 

4 Registered Pension Plans (RPPs)

Introduction

A. Types of Registered Pension Plans

B. Setting Up a Registered Pension Plan

C. Features of Registered Pension Plans

D. Types of Benefits

E. Eligibility for Retirement

Summary

Sources

Key Terms

Questions

 

5 Pension Adjustment (PA) and Other Pension Plans

Introduction

A. Pension Adjustment and its Effect on RRSP

Contributions

B. Profit Sharing Plans

C. Other Types of Plans

D. Taxation.

Summary

Sources

Key Terms

Questions

 

6 Registered Retirement Savings Plans and Other Savings Plans

Introduction

A. Features of RRSPs

B. Borrowing from an RRSP

C. Using Your RRSP to Give Yourself a Mortgage

D. Registered Education Savings Plans (RESPs)

E. Tax-Free Savings Account (TFSA)

F. Taxes on Sheltered and Non-Sheltered Savings

G. Pension Reform

H. Registered Disability Savings Plan (RDSP)

Margot and Craig

Summary

Sources

Key Terms

Questions and Problems

 

7 Retirement Income Options

Introduction

A. Transfer of Registered Plans

B. Retirement Fund Options

C. Non-Registered Investments

D. Demutualization and Government Pensions

E. Taxation of Annuities

Craig and Margot

Summary

Sources

Key Terms

Questions and Problem

 

Retirement Planning Case Assignment

The Case — John and Rachel Whitney

 

2 Estate Planning

 

8 Introduction to Estate Planning

Introduction

A. Estate Planning Issues

B. Planning at Retirement

C. Margot and Craig: Accumulating Assets

D. Drawing Down Retirement Assets

Summary

Margot and Craig

Key Terms

Problems

 

9 Family Law and Power of Attorney

Introduction

A. Family Law

B. Power of Attorney

Summary

Margot and Craig

Sources

Key Terms

Questions

 

10 Disposing of Estate Assets

Introduction

A. Dying without a Will — Dying Intestate

B. Wills

C. Executor

D. Probate

E. Business Assets

Summary

Margot and Craig

Sources

Key Terms

Questions and Problems

 

11 Taxation Issues

Introduction

A. Disposition of Assets Owned for Personal Use

B. Disposition of Assets Used to Earn Income

C. Transfer of Assets to Spouse

D. Non-Arm’s Length Transfers and Income Attribution

E. Deemed Dispositions at Death

F. Final Tax Return

G. Capital Gains Exemption and Estate Freeze.

Summary

Sources

Key Terms

Questions and Problems

 

12 Trusts, Donating to Charity, and U.S. Assets

A. Trusts

B. Trusts and Taxation

C. Donating to Charity

D. Life Insurance to Pay Final Taxes

E. Assets in the United States

Summary

Sources

Key Terms

Questions and Problems

 

3 Appendices .

Acronyms, Tax Rates and Time Value of Money Formula

Acronyms

Glossary of Tax and Time Value of Money Terms

Discounting and Compounding Cash Flows

Rates of Return

Personal Income Taxes.

 Time Value of Money (TVM)

 

Glossary of Retirement Planning Terms

 

Glossary of Estate Planning Terms

 

Index

Instructor Resources   top

For instructors teaching with the text, a manual, solutions to problems, and a test bank is available.

Related Resources   top

About the Author   top

Coleen Clark, MBA, CFP, is an Associate Professor of Finance at Ryerson University. She developed the Financial Planning program at Ryerson and registered the program with the Financial Planners Standards Council so that Bachelor of Commerce graduates as well as graduates in the Certificate in Financial Planning can write the national Certified Financial Planner® examination. Before coming to Ryerson, Coleen had extensive experience in the private sector in music publishing, magazine publishing, manufacturing and as a consultant to small businesses.

Both her first textbook, Retirement and Estate Planning in Canada, and Risk Management and Insurance in Canada are written to fill gaps in these fields by providing a detailed overview of these areas. Written with her students’ professional future in mind, both books also meet the educational requirements for CFP® examination.