If they are both eligible to collect the maximum CPP at age 65, what would their...
Fantastic news! We've Found the answer you've been seeking!
Question:
Transcribed Image Text:
If they are both eligible to collect the maximum CPP at age 65, what would their individual retirement incomes be including a 6% gross withdrawal from their RRIF and pension plans? (6 Marks) Ron and Janice Mawson are now both 55 years old but Ron was disabled for eight years which resulted in excess medical costs so they had to refinance the house. The current mortgage is $150,000 and the house has a market value of $800,000. They also have two children aged 12 and 14 and they continue to work in their current positions. < 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. < < Both Ron and Janice also have a defined benefit pension plan with their employer's which will pay 1.5% of their final salaries times their years of service. Ron and Janice will have final salaries of $125,000 and $80,000 respectively. Their years of service are 25 years for Ron and 30 years for Janice. < In addition, Janice has a non-registered portfolio worth $100,000 which is allocated 50% preferred dividend funds and 50% capital growth equity funds. This non registered fund currently has an unrealized capital gain of $30,000. She expects this fund to continue to grow by 8% per year with all of the growth relating to capital gains. Ron also has $80,000 invested in Canada Savings Bonds that are earning 3% interest and he plans on holding these bonds until retirement. Their house is held in joint tenancy and they have designated each other as beneficiary on their RRSP and Pension Plans. The non-registered accounts are held in their individual names and do not have beneficiary designations or rights of survivorship. If they are both eligible to collect the maximum CPP at age 65, what would their individual retirement incomes be including a 6% gross withdrawal from their RRIF and pension plans? (6 Marks) Ron and Janice Mawson are now both 55 years old but Ron was disabled for eight years which resulted in excess medical costs so they had to refinance the house. The current mortgage is $150,000 and the house has a market value of $800,000. They also have two children aged 12 and 14 and they continue to work in their current positions. < 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. < < Both Ron and Janice also have a defined benefit pension plan with their employer's which will pay 1.5% of their final salaries times their years of service. Ron and Janice will have final salaries of $125,000 and $80,000 respectively. Their years of service are 25 years for Ron and 30 years for Janice. < In addition, Janice has a non-registered portfolio worth $100,000 which is allocated 50% preferred dividend funds and 50% capital growth equity funds. This non registered fund currently has an unrealized capital gain of $30,000. She expects this fund to continue to grow by 8% per year with all of the growth relating to capital gains. Ron also has $80,000 invested in Canada Savings Bonds that are earning 3% interest and he plans on holding these bonds until retirement. Their house is held in joint tenancy and they have designated each other as beneficiary on their RRSP and Pension Plans. The non-registered accounts are held in their individual names and do not have beneficiary designations or rights of survivorship.
Expert Answer:
Answer rating: 100% (QA)
Based on the information provided here is a summary of Ron and Janice Mawsons financial situation 1 ... View the full answer
Related Book For
Income Tax Fundamentals 2013
ISBN: 9781285586618
31st Edition
Authors: Gerald E. Whittenburg, Martha Altus Buller, Steven L Gill
Posted Date:
Students also viewed these finance questions
-
Build a T-account for each account title. Label the DR (debit), CR (credit), NB (normal balance), and "+" or "-". Notes Receivable Debit Normal Balance Credit + Owner, Capital Owner, Withdrawals...
-
This assignment requires you to complete the 2022 tax reporting for a fictional woman named Anna Smith. Question 1 T1 - step 4 - line 66 This is Anna's taxable income Answer: Question 2 T1 - step...
-
1. Shilpa aged 42 plans on retiring at age 60 and would like to receive Canada Pensions Plan (CPP) and Old Age Security (OAS) benefits as soon as she is eligible. She has a goal of retiring on 70%...
-
3) Sauseda Corporation has two operating divisions-an Inland Division and a Coast Division. The company's Customer Service Department provides services to both divisions. The variable costs of the...
-
The dielectric constant for a soda-lime glass measured at very high frequencies (on the order of 1015 Hz) is approximately 2.3. What fraction of the dielectric constant at relatively low frequencies...
-
On System Requirement Analysis, describe and explain the topic below: Pros and Cons of modelling and simulation Benefits of modelling and simulation M&S Risk Mitigation Process Application of...
-
The Fremont Company has \($465\) million in assets, \($70\) million in current liabilities, \($125\) million in noncurrent liabilities, and \($270\) million in shareholders equity.Of the companys...
-
Homestead Pottery, Inc., is divided into two operating divisions: pottery and retail. The company allocates power and human resources department costs to each operating division. Power costs are...
-
Ritualized, stock responses to social situations are called _ _ _ _ _ _ _ _ _ _ _ _ _ _ and are the exact opposite of self - disclosure. 1 . Ritualized, stock responses to social situations are...
-
When we move a computer to a new location within a LAN (local area network), do we need to change the IP address of the computer? 5) (2,2,2 = 6 pts) Assume CIDR is used in a network. A router's...
-
Let Y1,...,Yn be a random sample from the following distributions with the unknown parameter(s). Estimate them by maximum likelihood and by the method of moments. fe (y) = 0y01, 0 y 1, 0 > 0
-
Marketing segmentation discussion Companies will often use more than one segmentation factor to divide a market and determine who they are targeting as their primary customer. Identify a product,...
-
On January 2, 2021, Worth Co. issued at par $2,000,000 of 5% convertible bonds. Each $1,000 bond is convertible during 2021. Worth had 200,000 shares of common stock outstanding during 2021. Worth's...
-
Fuji Co. is growing quickly. Dividends are expected to grow at a rate of 28 percent for the next three years, with the growth rate falling off to a constant 7 percent thereafter. If the required...
-
Given an acceleration vector, initial velocity (40, Yo), and initial position (X),Yo), find the velocity and position vectors for t 0. a(t) = (cost, 3 sint), (u,v) = (0,5), (x,y) = (1,0) What is the...
-
An iPhone 13 costs $600 in the United States. Today, forex exchange rates were identified at: $1 = 2.25 1 = P43 What should be the price of the same iPhone 13 in Philippines, assuming that the...
-
What is the amount of total interest dollars earned on a $5,000 deposit earning 6% for 20 years?
-
We have \(100 \mathrm{~kg} / \mathrm{h}\) of a feed that is \(60 \mathrm{wt} \%\) methylcyclohexane (A) and \(40 \mathrm{wt} \% \mathrm{n}\)-heptane (D) and \(50 \mathrm{~kg} / \mathrm{h}\) of a feed...
-
People are at their peak in terms of productivity when they are _________.
-
Since the 1980s, the share of measured income received by the top 5 percent has _________ and that of the lowest fifth of families has _________.
Study smarter with the SolutionInn App