It's true. Being smart about how you withdraw from your RRSPs, TFSAs, and taxable accounts can make a $50,000 difference, even for the middle class. In this video, Jin uses a hypothetical scenario to illustrate how AI can help save such an amount.
For easy-to-understand explanations of RRSPs and TFSAs, read Jin's free e-book.
To contact Jin about creating your own tax optimization AI, use this form.
00:00 Introduction
00:30 How investments are taxed with taxable accounts, RRSPs, and TFSAs
02:30 Traditional rules of thumbs for deciding which accounts to withdraw money from
05:20 How AI can generate more optimal withdrawal schedules
08:23 AI's potential to save even more on taxes
Ages: 41 for both
Province: Alberta
Citizenship: Canadians since birth
Final Ages: 85 for both
Starting account balances:
- Taxable: $100,000 each
- RRSP: $100,000 each
- TFSA: $100,000 each
- Total savings: $600,000 (owns no other assets)
Investment portfolio allocation:
- 20% in Canadian stocks with expected return of 8% per year
- 20% in US stocks with expected return of 9% per year
- 20% in Developed Market stocks with expected return of 7% per year
- 20% in Canadian bonds with expected return of 5% per year
- 20% in US bonds with expected return of 4% per year
Investments grow deterministically
Expected returns are 20% lower inside taxable accounts than in RRSPs or TFSAs
Annual savings: $0
Combined CPP payments: $13,200 per year
Inflation: 2% per year
Disclaimer: This video is for educational purposes only. It doesn't constitute advice.
EDDY WEALTH