couponstrip wrote:

Indeed, I ran into this problem when I decided to put together my own spreadsheet and run some numbers. Once I got into the detail of the analysis, I started to realize how complicated this could get based on both allocation and the taxation of that allocation.

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Finally, in retirement, as you have highlighted, the taxation of your gains should be considered since this can vary significantly from a 100% bond portfolio to a bond-preferred-equity portfolio to a 100% equity portfolio.

FWIW, I posed this question sometime over a year ago on this forum, and the fairly unified response I received was "to do that type of complicated determination, you need advanced software like RRIFmetic". The permutations and combinations do make it a fairly complicated bit of DIY spreadsheet work. But I do agree that your tax concerns are not trivial.

Coupon strip - Actually making the x% withdrawal for a few years does provide a better picture than looking at theoretical scenarios. We have been withdrawing 4% of our original retirement capital. Over the first 5 years, the withdrawal dropped as a % of our portfolios, but with the current markets, it is once again about 4%! But at least our capital is intact!

I have been in retirement for about 6 years and have been trying different tacks to minimize taxes. The income that we draw, is now almost all in form of dividends or ROC so at the moment, tax on income is minimal. We have also done tax-loss selling and applied this to previous years.

This allows us room to start withdrawals from RRIFs that we have set up early. Our situation is that we have 2/3 of our savings in registered accounts. Withdrawals are of course taxed at marginal rate.

Once we

have to make RRIF withdrawals, the picture will change again. This will change the base income that I mentioned in a reply to Shakespeare above. It will now be CPP+OAS+RRIF withdrawal - all fully taxed.

It is complex, but one simple idea I had, is to look at a withdrawal of 4% of (unregistered + 60% of registered), to allow for the heavy tax on RRIF withdrawals. This would (in our case) mean a safe withdrawal of under 3%.