Is it worth it for a retiree 65 years of age to put money
February 29, 2008 4:14pm CST
into a GIC that is about five years? Or should I stick with one that is around one year or so. The latter would only be about 1/4 percent more in interest rate than my high interest savings account. My husband wants me to convert my RRSPs into GICS, but I will be taxed on them and I would rather convert my savings into GICS and still have enough for the savings for the funeral. I want to put my RRSPS into annuities, but my husband is worried that our combined income next year will be over $50,000 and I will lose my Old Age Security, but if I have the correct amount, I will not have enough for the burial. I always hated being discouraged into making more money. I am in Canada by the way, what do you suggest?
4 Mar 08
I am putting my Registered Retirement plans into an annuity when it comes due, but I do find that no matter what, unless you are rich, any money you make extra will be taxed. I have not found a way yet, not for us ordinary middle classed people. I do not make enough to be taxed anyway.
9 Mar 08
And even if he did, it does seem a shame that he HAD to do it, because the Income tax people say that any interest we have (even one cent) is taxable, but they do not send forms unless we make over a certain amount. at least here in Canada. True the rich people get taxed fifty percent of their income, but before they do, they can use so many deductions and when you make $100,000 a year, it is a lot different from $10,000 to $25,000 a year, and you know how much many retirees make, $500 or so a month and how much even a cheap apartment, house, food, and utilities cost.
16 Mar 08
Well once you are 71 years old you wll have no choice but to put your RRSP's into GIC's or withdraw all the money. That is the law and you have no choice on it. Since you are 65 years old I think the 5 year GIC would suit your purposes. I am not very educated on this stuff but my sister is, since she owns her own income tax return company, and she had my parents do all this kind of stuff once they turned 71 years old. So I know that, that is the age you have to do it.