Tuesday, September 27, 2016

Viewing Detailed Cash Flows

11:41 AM


Question:

On the future assets table in the report, the registered assets at age 94 (year 2054) for the surviving client are $240,979.

At that age the client is required to withdraw a minimum 20% which would be $48,200. The investment return is a net 5% or about $12,000 maximum yet the client’s registered assets at the start of the next year are $217,683, which is about $13,000 more than the math would indicate it should be.

The cash-flow forecast for age 94 (2054) shows only $31,711 being withdrawn from the registered assets of $240,979 which is 13% and not 20% as required by CRA. Is there an explanation for this?

Is there something else in ‘registered’ other than a RRIF or a LIF that might distort the figures, like a TFSA?

Answer:

For each spouse on the 'Accumulations' tab on the 'View' page there is at the bottom under 'Your Future Assets - Detailed Data Table' links to pop-up tables that provide the detailed cash flow. You will see that the withdrawals are 20% at age 94.

For investment income, it will be based on the rates of returns selected in the 'Economic Forecast' page (less investment fees), weighted in accordance with the basis selected in 'Asset Mix for Projections' on the 'Options' page.

The summary tables on the results page combine TFSA, LIFs and RRIFs.

The Accumulations and Income Forecast tabs have detailed pop up cash flow tables that show all cash flows.

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