Smoking and life insurance premiums

Sometimes convenience is not worth it

Exploring some of the myths of no medical life insurance

Comparing the two. Which one is better?

Exploring the differences between these two types of coverage

Have you named beneficiaries on your RRSPs? A very common mistake that can cost your family a lot of money is failing to name a beneficiary or improperly choosing a beneficiary on your RRSPs (Registered Retirement Savings Plans). What is a beneficiary? A beneficiary is any person or organization that receives assets from a person after that person’s death. Failing to name a beneficiary can cost your family thousands of dollars in taxes. Unfortunately, I have personally found that in many cases when people set up an RRSP account at a bank or through an employer plan (Group RRSP) companies automatically designate the Estate as the beneficiary, and this will commonly overlooked in the future. How are RRSPs taxed at death? The general rule is when a RRSP account holder dies, the entire market value of the account, on the day of the death, is taxed 100% as income for that year. For example John passed away in 2018. He year and had a RRSP with a market value of $350,000. The total taxable income for John’s estate for 2018 will be $350,000 (assuming he did not earn any other income) The tax payable in 2018 (Ontario and Federal combined) for $350,000 of income would be $149,359 Three exceptions to the rule There are three major exception in which John would be able to defer paying taxes on his RRSP balance if he named a beneficiary · A spouse · A financially dependent child under the age of 18 · A financially dependent child or grandchild with a mental or physical disability. In the example above, if John had overlooked naming his spouse as the beneficiary, his estate would owe the CRA $149,359 in income taxes and then it would have incurred additional probate and executor fees. However, because John names his spouse as the beneficiary, the spouse can roll the entire $350,000 into her RRSP without paying any tax to the CRA and avoiding probate fees. A simple mistake that is easy to overlook, could have cost John over $150,000 when probate fees are factored in. What to do if you're not sure? If you’re not sure who you named as your beneficiary, or if you named one at all, this RRSP season is the best time to review it.