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  • Pay Down SS Upfront

    Is it possible, through the collabroative process, to give my ex-wife a lump sum payment (or all of my RRSP's, which is her recommendation) in an effort to reduce the impact of monthly SS (or possibly pay it all off to age 65).

  • #2
    Yes, and using RRSPs is a great way to do it.

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    • #3
      Not a good idea, it will not be tax deductible. Give RRSP is ok, it has no impact on your taxes. But not any other savings you might have.

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      • #4
        I wouldn't do it.

        What if your ex gets a high-paying job, or remarries? Non-compensatory SS could easily be wiped out. If you give anything as a lump sum, it is gone forever.

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        • #5
          what Janus and randomjohndoe said is true, no tax benefits to you and not taxable to her either since its locked in RRSPs, she is playing smart with you. since she is willing to take the RRSPs it simply shows that she has no need of SS.

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          • #6
            Doesn't she have a claim to 1/2 your RRSP anyway, thru equalization? (unless maybe you accumulated a significant portion of it before you married?)
            Or are you suggesting giving her the OTHER half in lieu of monthly SS?

            From what I've read it is quite common to wheel & deal on duration vs amount i.e. longer duration & smaller amount vs shorter duration and larger amount. What you are suggesting is just one extreme of this.

            I'm guessing you are trying to reduce the overall amount by giving it sooner? You'll just have to crunch numbers and see what the tipping points are - factoring in RRSP withdrawal taxes vs SS tax deductions and investment income foregone.

            Also: "Spousal support paid as a lump sum is not taxable or deductible, for example if a payor decided to pay all of his or her payments right away from his or her share of the family assets." From Income Tax Implications of Support Payments

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            • #7
              Slow down, look at your options and maybe have a coffee with the stbx and find out what her "camp" is advising her?

              No rush man. You've been married 30 yrs. You can take a few years to figure things out - will drive her fucking crazy. I know. Been there!

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              • #8
                I'm back in here. It's still think it's a great way to do it. I don't want to have to explain it. Can someone else step in. I'm heading for the cottage tomorrow
                Last edited by FreeNow; 09-27-2012, 10:52 PM.

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                • #9
                  Originally posted by FreeNow View Post
                  I'm back in here. It's still think it's a great way to do it. I don't want to have to explain it. Can someone else step in. I'm heading for the cottage tomorrow
                  I love it! I think I'll use this tactic in court!

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                  • #10
                    I wish my ex would pay me in a lump sum..... hmmm lets see. 15 yrs of x/year......(I'm only 55).... then lets add on the property... hmmm then lets add on the pension. Okay I'll make a deal - keep the house, keep the pension. Just give me the 15 yrs of SS.

                    Unless you are a very wealthy person you are deluded.

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                    • #11
                      Unless you are a very wealthy person you are deluded.
                      Lump sum spousal support is rarely a matter of (months to pay)($permonth); you have to take into account reduced risk for the future, the value of dollars today against future value along with the increase due to investing the lump sum.

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