#Finance #Investing #InheritancePlanning #Ontario
Wow, first of all, congratulations on receiving a sizable inheritance! It sounds like you have some clear goals in mind for what you want to do with this money. Here are a few suggestions that might help you make the most of your $500k inheritance in Ontario:
– Firstly, paying off the $30k debt to your family member is a great way to start fresh and have a clean slate.
– Setting aside at least 1 year’s worth of expenses is a smart move to ensure you have a safety net in case of any emergencies.
– Considering your desire to live comfortably and provide for your son, investing in a TFSA mutual fund, GICs, or similar options could be a good idea to generate some passive income.
– Since you are not very familiar with these investment options, seeking guidance from a fee-based financial advisor is a wise decision. They can help tailor a plan to fit your specific needs and risk tolerance.
What do you think about these suggestions? What are your thoughts on how you plan to invest your inheritance? Let’s brainstorm together and help you make the most out of this opportunity! 💰📈🤔
yes pay off debt to your family ~~and the car~~, take a trip for your self and maybe your family
invest the rest but don’t go with a mutual fund, read !StepsTrigger first
while 500k might seem like a lot, it is not that much since you have no savings, quite a bit of debt and don’t own a house
US 30yr bonds yielding close to 5% rn. That’ll get you an extra 25k a year if you toss it all in there. It’ll sort out your lack of savings and in 30 years you get the cash back and can give it to your son.
TFSA! Put as much as you can in a TFSA. Your financial advisor should be able to recommend a good plan with medium risk so that your money grows. The rest should be invested in a RRSP. Try to tie it up so that you don’t go on a spending spree.
You’re 59, broke, retired and make 50k? How? Pension?
Yes, talk to a fee-only, advice only planner as soon as you can.
Pay off the $30K immediately, buy a plane ticket to see your son, and put the balance in a high-yield savings account at your bank.
Don’t do another thing until you have a plan in place. You’ll have just enough money left over to make sure that you’re not stressed in retirement, and possibly leave an inheritance to your son, depending on how long you live.
How does the tax system work for an inheritance? Is it considered income? What was the inheritance pretax?
Always pay off debt first. Do you have a pension? or only CPP/OAS coming?
How much longer do you plan on working? I’d suggest moving to suburbs or a smaller city and buying a small condo so that you are mortgage free. You’ll still have property tax + utilites to pay, but being secure from rent increases or eviction will go a long way in retirement.
In summary, I’ll suggest the following:
– I presume you only have CPP/OAS coming
– You pay of $30k debt ($470k remaining)
– you buy a small city condo for ~$300k ($170k remaining)
– max your RRSP contribution room, take whatever tax credit you get + money remaining and pump into a TFSA (vanguard ETF) for tax free savings.
– work another 3-5 years to pad your retirement (every penny into a TFSA until you max contribution room). Aim to retire 63, if possible work to 65.
Good luck.
Dividend paying ETF’s/stocks, use the dividends to pay off your loans. Enjoy the extra income once the loans are paid off.
Look up well built wealth’s YouTube channel. Recently did a video on what to do when you come into a large chunk of money. Excellent tips.
I’d suggest staying away from advisors in big banks.
> an inheritance of $500,000 CAD (after tax)
No taxes on inheritence, talk to a lawyer if you need to.
> I’m 59 years old, **retired**, I rent my apartment, I have no savings, 1 son who is 25 and a car from 2012 that’s paid off entirely. **I make less than 50k a year**.
Explain? How are you making money?
Pay debt immediately, real estate may be a decent investment depending on your city and current rent prices. There isn’t enough information to give good advice to be honest, would need more detailed information regarding current income and expenses.
50K of income but no savings? Explain the income. Will some be withheld if you are generating investment income from the 500K? Then maybe buy a condo to reduce your expenses rather than build income.
Anthony Larsen the financial handyman costs $350 for 90min consult. He really helped my mom figure out the best plan for her retirement when my dad died and left her with big rrsps. He was also super helpful to my husband and I in figuring out our home purchase.
Sorry for your loss and best of luck!
> My 25 year old son is on his own living abroad and, I’ve always wanted to give or leave something significant for him but was never able to in the past.
It might be worth considering co-buying a property together with your son. You would get to live with minimal expenses, and your son stands to inherit property.
Find a place to live. That money won’t mean squat if rents keep rising and you can’t afford a down payment in 5-10 years.
You’re going to be broke again in like 3y. I can tell by your post.
$500k is not that much money. Pay off your debt then Invest it all in 50/50 bonds/market and only take 4%/year until you’re dead.
So that’s an extra $18.8k/yr. That’s it.
Don’t blow it.
Pay off the debt, enjoy life. Also, forgive me if it sounds out of place, but pay to have a will so your son wont go through troubles when is your time. For context, i’m 44 and i have a will so my brother gets an easier access to my assets. Good luck.
DON’T DO RRSP, not sure why people are suggesting an RRSP. Talk to an advisor but the reason you shouldn’t do an RRSP is your income is not very high from working so you won’t get any real tax benefit from the RRSP deduction. It is only beneficial because of the tax deduction which in your current situation is irrelevant.
Don’t tell your son or anyone about the amount of inheritance, until you have a plan on how to utilize it. Otherwise you might have some family members/friends needing money all of a sudden.
Talk to a fee based financial adviser. These comments are full of bad advice.
If part of that was an RRSP, you will still owe taxes on it. (Inhereited large RRSP, only took required taxes off 30%? Ended up owing another huge chunk of taxes on top of that).
> I make less than 50k a year.
How much less? From what sources since you have no savings? Since you’re 59 and retired and no savings I assume it is some kind of disability benefit?
You could literally create residual income from 500k
If you stick it into a MIC investment, your returns could up 7% or higher
7% on 500k = $35,000 year
$2916 per month
If you let it grow and compound and leave it for a year it would be better.
Just but XEQT.
It should be more than just a goal to pay off your debt. It should be paid immediately. Sounds sketchy to use the word “goal” when you actually have the money sitting in your bank account
Buy a house cash and chill. When you die, your son can sell it and get the inheritance. You never know what will happen to rents and I’d want the peace of mind of owning my place at old age.
Pay off the 30k debt. Buy Rddt stock with the rest :-), pull it out after it 10x about 6 yrs I’m guessing.