Financial Post Article: When should I start CPP and what’s the best way to draw down my retirement investments?


The Financial Post asked me to review the finances of a couple who are already in retirement, but want advice on their withdrawal strategy.

They are curious about how much they can take out of their investment accounts each year, so they have abundant cash flow, incur minimal tax and ensure their investment portfolio will last throughout their retirement.

In this article you’ll learn:

  • How they can be clear about how much they need for the lifestyle they want.
  • The specific type of investments and assets they currently have.
  • How much they spend on travel and hobbies. 
  • Whether or not they can afford to maintain their lifestyle during retirement.
  • The most tax-efficient strategy to draw down their RRSPs, TFSAs and non-registered investments.
  • How they can effectively split their income to save tax.
  • When they should start CPP and Old Age Security (OAS) benefits.
  • If they should adjust their asset mix (currently almost exclusively equities) to reduce risk and/or improve returns.


When should I start CPP and what’s the best way to draw down my retirement investments?

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Ed Rempel has helped thousands of Canadians become financially secure. He is a fee-for-service financial planner, tax  accountant, expert in many tax & investment strategies, and a popular and passionate blogger.

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  1. Ed Rempel on October 29, 2023 at 2:16 PM

    Hi Paddy,

    There are a lot of issues & opportunities in your question. Sorry, but you are essentially asking for most of a Financial Plan in a blog question.

    Your question supports my experience that people that pay off their mortgage more quickly are almost always worse off than those that pay it more slowly and invest the difference. After the mortgage is paid off, the amount of the payments is usually spent. It is a risk because it can become part of your lifestyle. Then you have a few high spending years before having to cut back when you retire.

    I would suggest to plan an effective use of the mortgage payments once they stop.


  2. Paddy Tsigane on September 8, 2023 at 8:36 PM

    Hi Ed,
    I’m 55 y/o and my house will be paid off early next year (7k$ left!). Not sure I’ll be able to direct more money to my investment though since my wife wants to renovate the upstairs bathroom, and besides the 3 months salary worth emergency fund set aside, the rest is invested. I only started investing aggressively by DIY about 7 years ago.

    With ~600k$ invested in 100% equities ETF (VEQT and VXC) so far in RRSP, TFSA and LIRA, I project that I’ll start reducing work in at 60 and keep working for another 5 years at the most after that. I’ll start investing in my non-registered account this year since I’ll have maxed out the registered accounts before Dec 31.

    I don’t plan on reducing my equities exposure as I near retirement since I’ll have a small pension that should cover about a third of my retirement expenses. If needed I figure can always start OAS at 65 to cover up to half of my retirement expenses. That’s why I’m not too worried about sequence of return risk, since I’ve got options. QPP I thought I could delay ’til 70, althought you do not appear to support this.

    Since my wife is 7 years younger than I am, I’m planning to use her age when I start withdrawing from my RRIF at 65 to lower the required amount withdrawn and spread taxes on more years. I think my withdrawing order will be both RIFF/LIF and non-reg from 65 until 70, and then RRIF/LIF + OAS/QPP starting at 70. I thought I could increase my emergency fund in my last working years to bring it up to about a year’s worth of expenses, although I think you do not necessarily recommend holding much cash.

    This is roughy my plan for the years ahead. I welcome any insights or comments you might have.
    Thanks in advance!

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