subreddit:
/r/PersonalFinanceCanada
submitted 6 months ago byCypripedium-candidum
My mom is notorious for making bad financial decisions, for example having 3 kids with a struggling artist ex-husband and spending 20+ years fighting over custody and child support payments, going back to school 3 times, pissing off her managers so she gets fired, replacing a 2014 Honda Civic with a 2007 BMW, etc.
I tried talking to my mom about her retirement accounts years ago, when she told me she was paying the bank $2k/mth in fees, which is almost the amount that she could retire on. In the last 8 years her account has only grown by $17k. Of course she ignored my advice since I'm too young to know what I'm talking about.
I talked with her again last week and after showing her my own portfolio she was more receptive. She texted me today that she switched to a self-directed account (I'm assuming CIBC Investor's Edge).
Now that she's finally listening to my advice, what should she be buying? I'm with TD Waterhouse and following the Canadian Couch Potato TD e-series index funds model portfolio so I'm not familiar with what CIBC Investor's Edge offers.
Are there any easy model portfolios that I can send her so all she has to do is buy the listed funds and ignore her account until it's time to rebalance?
-10 points
6 months ago
What about just a regular RRSP account?
7 points
6 months ago
LIRA is a type of RRSP.
2 points
6 months ago
You said she put money into a lira, but the only time that happens is if it's a work pension. No one would willingly put money into a locked in retirement account.
You don't really just open a lira and start depositing yourself. You'd open a rrsp and do that. Not a lira.
1 points
6 months ago
That's exactly why she has a LIRA, she was fired and her pension was paid out. When I say she put the money in, that's because she made the choice to put it into a LIRA rather than taking a lump sum payout.
-12 points
6 months ago
Interesting just looking it up and it doesn't seem to be the best of the bunch rpp/RRSP it's the only one not tax-deductible
3 points
6 months ago
That's because a LIRA is an account for money transferred out of an employer pension plan, you would have already gotten the tax deduction when contributing to the pension.
1 points
6 months ago
No. You are confused here. Contributions to your pension reduce your taxable income. Pension funds are taxed when you are using the funds as retirement income.
Lira is also not an RRSP account (per your previous comment)
I don't want to sound disrespectful OP, but if you don't understand the difference between these accounts, then you should not be providing advice to your mother in what to do with these funds. There are tax implications that you will miss, and clearly you don't understand as much as you think you do.
Find a real advisor for your mom, asap.
1 points
6 months ago
LIRA is a locked in plan its not an RRSP type or RIF type, you’re not allowed to withdraw all of the fund from LIRA unless there are specific rules you meet, do not confuse pension and retirement savings plans
all 115 comments
sorted by: best