Pension Reform and Design at the Heart of INTEGRIS
by Cristina Warlop, posted
Feb 27, 2013
Recently, the CEO of the CIBC Mr. Gerry McCaughey, publicly announced that he felt Canadians should reform the Canada Pension Plan to allow for voluntary supplemental contributions so that members could enhance their pension benefits in retirement. This type of innovative thinking traces its origins to an article first published in October 2004 by the CEO of INTEGRIS, Mr. Jean-Pierre Laporte entitled “Reforming the Canada Pension Plan”. As mentioned in the article above, Canadian investors are facing many challenges when it comes to saving for their retirement.
“Our Canadian retirement system is based on the three-legged stool theory where Canadian retirees call upon three sources of income in order to meet their daily needs: public pensions (the CPP and Old Age Security), private pensions (RPPs provided by employers), and private savings (monies saved through registered retirement savings plans (RRSPs) stocks, bonds, guaranteed income certificates (GICs), etc.). Ostensibly, Canadians can rely on all three sources and should therefore be able to retire comfortably so long as they take responsibility for their private savings. The reality, however, is that most Canadians are only able to call upon the single leg of public pension plans1.”
“It would give Canadians the choice to put aside more – a little at a time – with the confidence of clearly knowing what benefits it will bring,”
In light of the new tax rules that penalize passive investments within CCPCs, advisors must understand how pension legislation can become a powerful tool to deal with wealth succession, business succession, and tax optimization within a corporate environment.Learn more about the ppp101 course
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