More Canadians making early withdrawal from RRSPs

At this time of year most people are thinking about topping up their RSP to get a bit of a tax break, but unfortunately some Canadians are making plans to cash out their RSP before retirement to pay for living expenses.

As politicians wring their hands over Canadians’ lack of retirement savings, figures obtained by Global News from years of tax filings indicate a significant jump in the number of Canadians making early withdrawals from their RRSPs – not for housing or education, but simply to make ends meet.

The biggest increase was from 2007 to 2009, when 1.86 million Canadians took out RRSP cash early. That figure dipped slightly by 2012, to 1.82 across Canada, but remains about 7 per cent above 2007 levels nationally, 12 per cent above 2007 levels in Quebec and almost 10 per cent above in comparatively wealthy Alberta.

Read the full article over at Global News.

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Bull! Bull! Bull!
Guest
Bull! Bull! Bull!

don’t need RRSP when you can sell your house to HAM for $1 million dollars.

i’m sure the native americans thought they were getting a great deal when they sold manhattan for beads.

hoax
Guest
hoax

Prematured withdrawals! Grandpa of premature ejaculation.

Oracle
Guest
Oracle

The well to do have retired early and are withdrawing money from RRSPs before they turn 65 so they don’t get any clawbacks on OAS and GIS.

space889
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space889

Garth has repeatedly said RRSP is NOT for retirement purpose and it looks like people are listening to this advice. No surprise here…

Randy Randerson
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Randy Randerson

People are desperate enough to give money to the government with both hands, it shows how Harpo has failed the down-trodden Canadians in our society.

history
Guest
history
I have an RRSP and it’s kept me from collecting scads of welfare. People look at me stupid, because the RRSP fluctuates between $7 and $10 grand, just a pittance. The better strategy would of been to leverage the RRSP years ago on a low downpayment mortgage, and ride the HAM wave… OR, spend the RRSP on non-asset type goods or services, (like drugs), and then go Hat in Hand to the Government on bended knee and say “SAVE ME, oh Benevolent Government”… but, I couldn’t do it… there is something called pride, and the shear joy of coming on line and ramming feces down the throats of the debt piggies… so, I’ll keep my RRSP, my no debt lifestyle, and stay on the cutting edge of those that despoil our world on their Gross Deceit, that they could possibly… Read more »
crikey
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crikey
A friend has noticed that the minimum monthly payment on his CIBC line of credit has recently plummeted, from 3% of the outstanding balance to 2% of the outstanding balance. Is this is a policy change across all (or most) outstanding personal lines of credit at CIBC? It seems like a big change to me. It would mean that somebody that has $50,000 owing on a CIBC personal line of credit is suddenly going from paying a minimum of $1500 down per month to $1000 per month. Of course, since we know that all Canadians are fiscally responsible with debt, I’m sure the extra monthly $500 is always going to go towards paying down principal, right? This debt breathing room is not going to be used to borrow even more money, right? If correct, why would CIBC do this now,… Read more »
crikey
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crikey

Correction – the first link above should be:
https://www.cibc.com/ca/loans/loans-glossary.html

paulb
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New Listings 319
Price Changes 92
Sold Listings 206

TI:12762

http://www.paulboenisch.com

space889
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space889

@crikey – They get more interest over the life of the LOC with lower minimum payments since most people rarely pay them off until they declare bankruptcy. Also, this is a lot easier to generate new income than trying to get a new banking customer since retail banking marketplace is pretty saturated now.

The worst thing for a banker is someone who pays off their debt fast.

crikey
Guest
crikey

@#10
Then why have any minimum payment at all other than interest?
That’s what RBC does, I believe. Why doesn’t CIBC get rid of the 2% balance repayment entirely?

Its not as simple as you say. CIBC aren’t stupid – if it was that easy CIBC would never have had 3% minimum repayment to begin with.

So why have CIBC changed it now of all times? What is different now from one or two years ago?

Over saturated market? Maybe. So their answer is to help Canadians go deeper in debt?

Or, possibly their analysts have surmised their customers may be less able to repay the 3% monthly in the face of current economic conditions?

Whatever the case, given what we know it reeks of desperation and irresponsibility.

southseacompany
Member
southseacompany

“Oil sinks below $50, dragging down Canadian dollar” CBC News.

http://www.cbc.ca/news/business/oil-sinks-below-50-dragging-down-canadian-dollar-1.2967420

“International contract Brent crude was down $1.32 to $59.90 and Western Canada Select, a contract traded by Canadian oil companies, stood at $36.45 US a barrel.”

“That helped drive the dollar down 0.19 of a cent to 79.52 US cents at the close of trading.”

southseacompany
Member
southseacompany
“ANALYSIS: B.C. economy booming despite energy sector woes: Susan Bonner” CBC News. http://www.cbc.ca/news/business/b-c-economy-booming-despite-energy-sector-woes-susan-bonner-1.2967214 “What starts in the west washes across the county in one way or another. The value of the Canadian dollar, the cost of borrowing money, our balance of trade, the wealth of our banks, the national job picture — all tied to some extent to what’s happening in the energy industry.” “But this is Vancouver. People want to live here. On these warm sunny February days with those gorgeous vistas perfectly displayed, I wonder why I’ve never lived here. And then I look at housing prices (and remember I live in Toronto!) and give myself a shake.” “Vancouver residents bear a heavier burden than the rest of us when it comes to housing costs and household debt, but that is another economic fault-line that is pan-Canadian. The… Read more »
88
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88

HAM doesn’t sell oil, it buys.

Still don't get it?
Guest
Still don't get it?

The World is awash in money!

Apple now worth $980 Billion Canadian Dollars.

Wow.

And $1 Million homes are expensive? Not in that context.

The new world is here. HSBC… If you guys only knew the truth. Can’t state here for fear….Big brother is watching.

patriotz
Member
StupidityCheck
Guest
StupidityCheck

From link in #16:

“While deep-pocketed investors in Toronto and Vancouver stepped in to fill the void, the picture has been different in smaller markets where condo sales are driven largely by first-time buyers.”

In other words, rich foreign money is driving the YVR and YYZ markets.

StupidityCheck
Guest
StupidityCheck

“When 25 per cent (of homes) turn over and there’s a roar around some laws to cap size, clearly we are being run by speculation and investment and not the community and housing,” said Trent.

http://www.theprovince.com/news/West+council+tackle+monster+homes+special+meeting/10834362/story.html

patriotz
Member

@17: “In other words, rich foreign money is driving the YVR and YYZ markets.”

Allegedly.

A couple of threads ago, we had a quote from Bob Rennie on how boomers are supporting the entry level condo market with the equity in their properties.

Which expanation is the best match for the household debt numbers?

Sure the deep pockets are driving the multimillion dollar West Side house market, but that’s irrelevant to the average person just as it was before the bubble.

Son of Ponzi
Guest
Son of Ponzi

It soon will be:
I sell two condos, my syster sell two condos.

southseacompany
Member
southseacompany
“Oil price crash raises risk of Canada housing market correction: Reuters poll”, Reuters http://ca.reuters.com/article/domesticNews/idCAKBN0LS1EQ20150224 “The recent collapse in oil prices has heightened risks that Canada’s long housing boom is due for a correction, according to a Reuters poll.” “Nearly three-quarters of forecasters polled said the chances of a sharp fall in home prices have risen compared with three months ago. Most said the plunge in the price of crude oil would be the most likely trigger for a housing correction.” “Still, a majority of analysts said house prices falls are likely to be limited to the provinces in Western Canada that depend heavily on oil extraction, production and export.” “As an insurance against further economic weakness, the central bank hinted at further policy easing, despite Canada’s relatively high household debt-to-income levels. ” “”Historically low borrowing costs will continue to support… Read more »
southseacompany
Member
southseacompany

“Toronto housing bubble showing no signs of bursting” NPR Buffalo

http://news.wbfo.org/post/toronto-housing-bubble-showing-no-signs-bursting

“A recent survey by one of Canada’s big banks suggests that the cost of renting or owning a home in the city of Toronto is climbing out of reach of most residents.”

“Experts say there is no end in sight to the housing bubble experienced by Toronto, even while they insist prices are at least ten percent higher than they should be.”

“But real estate agents counter, saying as long as demand continues to outweigh supply, those prices will continue for the foreseeable future, even if there is a modest cooling.”

“The current situation, according to the TD Economics survey, is in danger of pushing prices beyond the reach of even high income residents.”

StupidityCheck
Guest
StupidityCheck

Patriotz,

Last year there were a total of 10,545 sales of SFH/TH/Condo in all of Vancouver. It’s estimated that there are 5,736 immigrants to BC under the IIP each year, with the vast majority settling in Vancouver. It’s not an insignificant number.

http://www.scmp.com/comment/blogs/article/1671607/blame-quebec-why-halting-immigrant-investor-programme-cant-halt-flow

Does anyone think immigration from Hong Kong in the early 90s wasn’t enough to drive up prices back then? Arguing that China (which has almost 200 times the population of Hong Kong) can’t affect prices in Vancouver is ridiculous.

Oracle
Guest
Oracle

I can’t believe some of you are still debating whether recent temporary and permanent migrants are affecting house prices with their overseas money.

Unbelievable.

The detractors on this site are here to confuse you.

When metro vancouver becomes an Asian majority city, debate will be moot.

The joke has been on you all along.

Laughable really.

Oracle
Guest
Oracle

And Patriotz,

You live in Ottawa. Why you so concerned posting on a Vancouver RE site as opposed to an Ottawa blog. You are no where in there.

Working for Citizen and Immigration Canada in Ottawa means a part of your job during working hours is to post exactly what you are posting.

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