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Old Age Pensions - Means Test?


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Canadian old age pensions are allocated on the basis of what one has invested and age.

http://www.servicecanada.gc.ca/eng/services/pensions/oas/pension/index.shtml

I suggest that the system was created to assist those who had a need. Many people now are in a financial position where they really do not "need" this government sponsored payments.

I suggest that there be a means test for the receiving a government pension. Perhaps the trigger rate could begin at ... those earning less than $250,000 a year. Or maybe less.

Any other ideas about pensions?

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This is a conversation that many of predicted would eventually happen - should everyone get CPP? Why this is being discussed is because the plan is probably not viable in the long term.

I'm glad I don't pay into CPP, since it will be gone by the time I can draw on it.

I completely agree not everyone should receive it.....as long as you give everyone the option of not paying into it.

Edited by Charles Anthony
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Canadian old age pensions are allocated on the basis of what one has invested and age....

Not quite. Big Guy, I suggest that you talk to an old person to find out how government pensions are paid in Canada.

My neighbour, an old woman, at least makes an effort to talk to young people to find out about those weird devices that young people stare into and click.

(Becuase of her research, I now understand that young people don't all use iPhones.)

=====

She also told me that she gets her RRQ - but only some of the "pension de vieillesse" and none of the "Supplément de revenu garanti".

It seems that old Canadian people, even in Quebec, can receive three types of money. As those young anglo kids would say, "Whatever... ".

I'm glad I don't pay into CPP, since it will be gone by the time I can draw on it.

I don't think you quite understand how this works.

The CPP, OAP and GAINS are various payments to old people that come from the State. The State taxes all of us in various ways.

So, it is absurd to say that you "don't pay into CPP"...

Edited by August1991
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Politicians are afraid of old people....

Obama is not afraid of old people because the US Fed is keeping interest rates low - which means many old people even in Canada (municipal workers, Ontario teachers) have smaller retirement nesteggs/income.

We may have to raise taxes to make good on those pension promises!

=====

My head aches. The directions of these State taxes/payments are so complicated....

Edited by August1991
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Not quite. Big Guy, I suggest that you talk to an old person to find out how government pensions are paid in Canada.

My neighbour, an old woman, at least makes an effort to talk to young people to find out about those weird devices that young people stare into and click.

(Becuase of her research, I now understand that young people don't all use iPhones.)

=====

She also told me that she gets her RRQ - but only some of the "pension de vieillesse" and none of the "Supplément de revenu garanti".

It seems that old Canadian people, even in Quebec, can receive three types of money. As those young anglo kids would say, "Whatever... ".

I don't think you quite understand how this works.

The CPP, OAP and GAINS are various payments to old people that come from the State. The State taxes all of us in various ways.

So, it is absurd to say that you "don't pay into CPP"...

No, I actually just don't pay into it anymore.

Salaried employees must pay into CPP, it shows your CCP contribution right there on your paycheck. I incorporated so I have the option of paying into it or not. It's not that I just pay taxes in other ways, I just no longer have to pay the CPP and I get to pocket it instead (or leave the amount in my corp).

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$250,000 in retirement, wow! I think most people would be happy have $50,000 in retirement! Since the cost of living is going up each week, month and year, I don't think people in retirement,those who are $50,000. and under should pay any income taxes. In certain regions of this country, at $50,000, would feel like 250,000. to them. Anyone making over 100,000 in retirement, should never even want to accept government support.

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Canadian old age pensions are allocated on the basis of what one has invested and age.

http://www.servicecanada.gc.ca/eng/services/pensions/oas/pension/index.shtml

I suggest that the system was created to assist those who had a need. Many people now are in a financial position where they really do not "need" this government sponsored payments.

I suggest that there be a means test for the receiving a government pension. Perhaps the trigger rate could begin at ... those earning less than $250,000 a year. Or maybe less.

Any other ideas about pensions?

I think we should be clear what we're talking about:

CPP - Canada Pension Plan:

You work, you pay in, you get back.

60-65+

OAS - Old Age Security

Universal benefit, everybody gets it.

65 or 67+

GIS - Guaranteed Income Supplement

Means tested, lower income seniors

65+

The government also encourages RRSP and TFSA savings plans with tax breaks.

And Ontario will have it's own pension plan in addition to CPP.

I think even wealthy people should get everything they're entitled to as a Canadian.

CPP - They paid, they get back.

OAS - If they want to donate their OAS to a good cause, or other seniors etc, that's their choice.

GIS - They won't qualify.

Edited by jacee
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$250,000 in retirement, wow! I think most people would be happy have $50,000 in retirement! Since the cost of living is going up each week, month and year, I don't think people in retirement,those who are $50,000. and under should pay any income taxes. In certain regions of this country, at $50,000, would feel like 250,000. to them. Anyone making over 100,000 in retirement, should never even want to accept government support.

I used that figure as a beginning to establish a principle. The principle of the reason the entitlement was first established. If there is agreement on the principle that it should be means tested then the trigger can be re-negotiated.

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I used that figure as a beginning to establish a principle. The principle of the reason the entitlement was first established. If there is agreement on the principle that it should be means tested then the trigger can be re-negotiated.

For which one BG?

CPP?

You pay in, you get back.

If you try to means test it to cut off the wealthy, they're going to want to stop paying in.

It'll be a mess.

CPP wasn't intended only for low income people. It's a group pension plan paid into by working people for their retirement.

If you don't work and pay in, you are not entitled to it.

OAS & GIS are for lower income people who have no pension.

.

Edited by jacee
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Thanks. I wasn't sure.

So OAS is already means tested and so is GIS.

.

I really need to proofread since I always post from my phone. Edited by Smallc
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  • 2 months later...

What do any of you think of....instead of increasing CPP, get rid of income taxes for retirees with an income of 50,000 and under?? The government could afford this by increasing income for people earning over 250,000. People at the bottom are having a hard time and people with very high incomes, wouldn't really miss it and besides , I'm sure they could find some tax loop-holes.

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What do any of you think of....instead of increasing CPP, get rid of income taxes for retirees with an income of 50,000 and under?? The government could afford this by increasing income for people earning over 250,000. People at the bottom are having a hard time and people with very high incomes, wouldn't really miss it and besides , I'm sure they could find some tax loop-holes.

Yeah but CPP doesn't come out of gumint revenue. They would increase the payroll deductions on people. There's a lot more people making under $50,000 than making more than $250,000 so I'm not sure if it's revenue neutral.

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Canadian old age pensions are allocated on the basis of what one has invested and age.

http://www.servicecanada.gc.ca/eng/services/pensions/oas/pension/index.shtml

I suggest that the system was created to assist those who had a need. Many people now are in a financial position where they really do not "need" this government sponsored payments.

I suggest that there be a means test for the receiving a government pension. Perhaps the trigger rate could begin at ... those earning less than $250,000 a year. Or maybe less.

Any other ideas about pensions?

Might I suggest looking into what benefits people receive from the government after or near retirement?

There is the Canada Pension Plan (CPP/QPP), Old Age Security (OAS), and the Guaranteed Income Supplement (GIS). There's different qualifications and rules for each.

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http://www.macleans.ca/news/macleans-cover-preview-old-and-loaded/

Maclean ran an article about this recently unfortunately their making you pay for it. but there's the link.

The premise of the article is that our elderly are more than well enough provided for. With OAS/GIS guarrantees a base income that provides regardless of whether or not someone's worked or not. combined I think that benefit adds to 22000 for a single person. CPP and RRSP add on to that benefit. the OAS claw back doesn't start until a retiree make over 68000. their medication is supplemented. Additionally the major of our elderly are home owners who have paid off their mortages. they pay less in auto insurance (to a point/ dependant on the province). Oh and senior discounts on top of that.

I think our elderly are more than well enough provided for. If they're disadvantaged its because they did not put into their rrsps or they didn't work. I have no sympathy for them.

We need to be more concerned about the younger generation who are going to have pay for these benefits. cpp was a poorly designed system and a product of the 60s generation that created it. soon we're going to be facing a gap where they'll be more retirees than workers. Leaving the new generation to pay for the old (the ones who designed it.) on top of that they're facing higher unemployment and higher housing and living cost than our elderly population.

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It's amazing that we have CPP, OAS, GIS, and RRSP for retired and aging Canadians, but we can't even get a national daycare program to get single parents back into the workforce sooner and to ensure children in poverty have some standard of care. We have the Universal Child Care Benefit (UCCB); that's it and everyone with children gets it.

Edited by cybercoma
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http://www.macleans.ca/news/macleans-cover-preview-old-and-loaded/

Maclean ran an article about this recently unfortunately their making you pay for it. but there's the link.

The premise of the article is that our elderly are more than well enough provided for. With OAS/GIS guarrantees a base income that provides regardless of whether or not someone's worked or not. combined I think that benefit adds to 22000 for a single person. CPP and RRSP add on to that benefit. the OAS claw back doesn't start until a retiree make over 68000. their medication is supplemented. Additionally the major of our elderly are home owners who have paid off their mortages.

60% own houses mortgage free.

11% are still paying a mortgage.

The other 29% presumably pay rent, or live with family.

they pay less in auto insurance (to a point/ dependant on the province). Oh and senior discounts on top of that.

I think our elderly are more than well enough provided for. If they're disadvantaged its because they did not put into their rrsps or they didn't work. I have no sympathy for them.

We'll keep that in mind.

We need to be more concerned about the younger generation who are going to have pay for these benefits. cpp was a poorly designed system and a product of the 60s generation that created it. soon we're going to be facing a gap where they'll be more retirees than workers. Leaving the new generation to pay for the old (the ones who designed it.) on top of that they're facing higher unemployment and higher housing and living cost than our elderly population.

BS

CPP is fully funded, fully viable, the envy of the rest of the world.

Quit yer misdirected whining about CPP/OAS/GIS. They're all functioning well.

Health care for boomer seniors is where we're

really gonna nail you young whippersnappers' a$$es to the wall !!

So whadarya gonna do about it?

Put us on an ice floe?

Come and get me sonny!

I'll crank up my fave heavy metal tunes and twist you like a pretzel and hang you out to dry!!

Now kids .. time for a few giggles and a nap ... anybody for some of grannies' brownies?

:D

.

Edited by jacee
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60% own houses mortgage free.

11% are still paying a mortgage.

The other 29% presumably pay rent, or live with family.

We'll keep that in mind.

BS

CPP is fully funded, fully viable, the envy of the rest of the world.

Quit yer misdirected whining about CPP/OAS/GIS. They're all functioning well.

Health care for boomer seniors is where we're

really gonna nail you young whippersnappers' a$$es to the wall !!

So whadarya gonna do about it?

Put us on an ice floe?

Come and get me sonny!

I'll crank up my fave heavy metal tunes and twist you like a pretzel and hang you out to dry!!

Now kids .. time for a few giggles and a nap ... anybody for some of grannies' brownies?

:D

.

CPP is not fully funded. as late back as 1997 it funded under a pay as you go system where it was funded on a annual basis and there was no reserve funds. in 1997 a reserve was recreate but it is by no mean fully fund or sufficient. CPP is only the envy of retiree living off it. If you thinks its working think again. They keep raising premiums and the entitlement age, its only working for the generation that built it.

There's this thing called wikipedia you might want to research what you talking about before attempting smack talk

You're right we need to worry about the health cost for the boomer generation as well thanks alot!!!

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CPP is not fully funded. as late back as 1997 it funded under a pay as you go system where it was funded on a annual basis and there was no reserve funds. in 1997 a reserve was recreate but it is by no mean fully fund or sufficient. CPP is only the envy of retiree living off it. If you thinks its working think again.

It's working just fine. Do your research.

/5-reasons-not-to-worry-about-the-canada-pension-plan

They keep raising premiums

They raised them significantly in the 90's to cover boomers. Only normal cost-of-living increases since then.

Do your research.

and the entitlement age,

The entitlement age for CPP has not increased.

OAS age went up to 67 for people now ~55.

Make sure you know what you're talking about before pushing the panic button.

its only working for the generation that built it.

There's this thing called wikipedia you might want to research what you talking about before attempting smack talk

Ya, you should try that! :)

You're right we need to worry about the health cost for the boomer generation as well thanks alot!!!

No worries. The gov will make billions to cover it, from medical marijuana sales, and even more when they legalize pot for all adults.

If necessary, we'll hold geezer rock concerts for boomers to raise funds. :D

.

Edited by jacee
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They raised them significantly in the 90's to cover boomers. Only normal cost-of-living increases since then.

CPP was last updated in 2003 to an annual contribution of 9.9% of your income, (from what had previously be 3% for people who created it). The whole system is designed to pass of the cost of retirement to the younger generation. You're forgetting that there are fewer young people today than there are retirees, and with the Boomer generation heading into retirement within ten years there may be as much as 2 retirees for every 3 employed. (currently about 1 retiree to 5 employed) The CPP system has a two year reserve. I don't need to go into the math the tell you that's a system thats not sustainable.

No worries. The gov will make billions to cover it, from medical marijuana sales, and even more when they legalize pot for all adults.

PLEAAAASEE, the only thing trudeau would use that money for is stroking his massive ego.

If necessary, we'll hold geezer rock concerts for boomers to raise funds.

Can't wait i'm holding my breath

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Of course contributions and the qualifying age had to go up, the average age is ten years longer than in the sixties. You live longer, you will need more in your retirement, pension plan or not. It should probably have been done earlier but then you get the GD boomers won't retire and make room for the younger folks argument. The boomers are a speed bump in time, not a permanent condition.

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