.

[Smallc]

You are assuming that GDP rises faster than the debt, and that's not going to happen if we keep borrowing and interest rates return to normal.

There's a lot of ifs in there.

[Big Guy]

CPP does not need to be means tested since people pay into it and it is a self sustaining fund.

...

That depends on your personal view. I look at it as a forced insurance policy in case you become destitute. If you are making $200,000 a year when you qualify then you do not get a payout.

The question was how to save some money on payouts.

That is one way.

[dre]

Seriously? You think borrowing money every year instead of paying it off has nothing to do with the amount of debt?

That depends on the value of the units of denomination.

[Smallc]

That depends on your personal view. I look at it as a forced insurance policy in case you become destitute. If you are making $200,000 a year when you qualify then you do not get a payout.

The question was how to save some money on payouts.

That is one way.

CPP doesn't need to save money on payouts. It's self financing.

[Argus]

There's a lot of ifs in there.

We KNOW we're going to be borrowing for a while. We KNOW there are going to be any number of recessions during the next fifty years. We KNOW that interest rates are going to rise substantially during that period.

[Smallc]

We KNOW we're going to be borrowing for a while. We KNOW there are going to be any number of recessions during the next fifty years. We KNOW that interest rates are going to rise substantially during that period.

And we know that in two decades, debt to GDP has been cut in half.

[blueblood]

In those two decades the interest rates came down and the debt was being serviced.

People here seem to forget what high rates are like when too much money is being borrowed...

[Smallc]

In those two decades the interest rates came down and the debt was being serviced.

And that will continue for quite a few more years yet, most likely.

People here seem to forget what high rates are like when too much money is being borrowed...

It looks like we're on track to borrow about $20B this year. That's far from too much money in the opinion of most economists.

[jacee]

That depends on your personal view. I look at it as a forced insurance policy in case you become destitute. If you are making $200,000 a year when you qualify then you do not get a payout.

I have never heard that CPP is clawed back at $200k.

I don't believe that's true.

I think you are confusing it with OAS that is clawed back at incomes over $70k and goes to 0 at about $115k.

.

[Big Guy]

I have never heard that CPP is clawed back at $200k.

I don't believe that's true.

I think you are confusing it with OAS that is clawed back at incomes over $70k and goes to 0 at about $115k.

.

My suggestion is that one way to generate monies is to have a means test for entitlements.

Some people view entitlements as an investment program where everyone is allowed to a payback depending on your risk and how much you have invested.

I believe that there are certain entitlements (like CPP) are government forced insurance plans where the payments should be made on need. My starting suggestion is that the CPP have a ceiling of $200,000 income a year for a person to receive any payments. A person with that kind of income does not require additional income. It is only my approach based on my personal vision of our society.

[msj]

That depends on your personal view. I look at it as a forced insurance policy in case you become destitute. If you are making $200,000 a year when you qualify then you do not get a payout.

The question was how to save some money on payouts.

That is one way.

Sure, and it would be small potatoes to do this.

These people, maybe a total of 20,000 in all of Canada, are already paying marginal tax rates of 45% to 53% on this income.

A big whippee doo to get, maybe, $180 million in extra savings from this.

Ineffective since the CPP is a separate and self sustaining fund and not in need of any savings.

I also think it is doubtful for OAS/GIS to really need much in the way of further tweaking other than the proposed clawback I have already mentioned.

It tends to be people who only look at the liability side of the balance sheet and the expense side of the income statement who make this claim.

Given that these people are half blind to the revenue side and the asset side I no longer place any value on their opinions.

I believe most public policy people do the same, after all, why listen to someone with only a portion of the facts?

[Big Guy]

....

I believe most public policy people do the same, after all, why listen to someone with only a portion of the facts?

I don't know. Why bother posting your views?

[msj]

I don't know. Why bother posting your views?

What I meant is don't believe what you hear from the likes of Argus and other half-blind posters.

Jack Mintz had an op-ed column in the National Post a month or two back.

He, of course, went on about the future liabilities and expenses of our pensions (in particular government employee obligations).

Completely ignored any mention of related assets.

I stopped reading because, why bother?

If someone has to paint a scary picture by ignoring something as basic as the fact that Canadian governments do have significant assets in place already to help offset the future costs of government employee liabilities (the point of the article in this case) then why would I finish it?

He is guilty of purposely misinforming people for the sake of his politics.

I see that type of thing done here all the time by people with a fraction of Mintz' intellect.

[Big Guy]

What I meant is don't believe what you hear from the likes of Argus and other half-blind posters.

Jack Mintz had an op-ed column in the National Post a month or two back.

He, of course, went on about the future liabilities and expenses of our pensions (in particular government employee obligations).

Completely ignored any mention of related assets.

I stopped reading because, why bother?

If someone has to paint a scary picture by ignoring something as basic as the fact that Canadian governments do have significant assets in place already to help offset the future costs of government employee liabilities (the point of the article in this case) then why would I finish it?

He is guilty of purposely misinforming people for the sake of his politics.

I see that type of thing done here all the time by people with a fraction of Mintz' intellect.

Thank you for the reply. I have always treated any financial advice and financial analysis by anonymous individuals on public access bulletin boards as worth what it is that they are being paid to give that advice.

These boards are not generally populated by rich individuals. They have better and more lucrative things to do with their time.

Many years ago I was giving my young grandson a lecture on saving and possibly investing his allowance and the money he was making on his part time job (cutting grass). His reaction was a respectful, "Gee gramps, if you got all the answers, why aren't you rich?"

I would pose the same question to those who are sharing their expert opinions on these boards on investments and stock market strategies.

[Argus]

Jack Mintz had an op-ed column in the National Post a month or two back.

He, of course, went on about the future liabilities and expenses of our pensions (in particular government employee obligations).

Completely ignored any mention of related assets.

Assets? To counter hundreds of billions in debt? You mean like, we could sell parliament hill or PEI or something?

Assets you can't sell aren't going to help you when the banker comes calling with his hand out.

[cybercoma]

My suggestion is that one way to generate monies is to have a means test for entitlements.

Some people view entitlements as an investment program where everyone is allowed to a payback depending on your risk and how much you have invested.

I believe that there are certain entitlements (like CPP) are government forced insurance plans where the payments should be made on need. My starting suggestion is that the CPP have a ceiling of $200,000 income a year for a person to receive any payments. A person with that kind of income does not require additional income. It is only my approach based on my personal vision of our society.

You need to understand the difference between CPP, OAS, and GIS. I'm practically Marxist and even I wouldn't take people's CPP away.

[msj]

Thank you for the reply. I have always treated any financial advice and financial analysis by anonymous individuals on public access bulletin boards as worth what it is that they are being paid to give that advice.

These boards are not generally populated by rich individuals. They have better and more lucrative things to do with their time.

Many years ago I was giving my young grandson a lecture on saving and possibly investing his allowance and the money he was making on his part time job (cutting grass). His reaction was a respectful, "Gee gramps, if you got all the answers, why aren't you rich?"

I would pose the same question to those who are sharing their expert opinions on these boards on investments and stock market strategies.

Sure, I agree to be skeptical of any anonymous person on any topic.

How someone chooses to spend their spare time however is up to that individual regardless of wealth.

Besides, how wealthy a person is has little to no bearing on that person's knowledge nor intelligence. Just look at Kevin O'leary as an example of rich guy with neither knowledge nor intelligence.

As to the points I have made - they are easily verifiable if you have a tax program like Turbo Tax.

Look to lines 234 to 236 to see how OAS clawback is calculated. Look to line 210 for the pension split. Then consider moving that split to line 253 (below the net income line).

It's pretty simple to do if you have the software and know where to make the inputs.

As for your proposed CPP saving ~ $180 million, well, back of the napkin math:

Say 20,000 people would qualify as earning CPP and making $200,000+ net incomes and presumably get max CPP who are already paying marginal tax rates of 47.7% (BC) or 53.3% (ON) (other provinces will vary). The marginal tax rates are easily verifiable if you go to taxtips.ca. The 20,000 is just a guess on my part so it could be off by a factor or two, I admit.

It does not take a rocket scientist to figure out that these people are already paying back nearly 50% of their CPP to the feds/provincials so you are looking at little further benefit.

That's just basic math: 20,000 people times max CPP received less taxes already paid gets you the remaining amount of your expected CPP recovery.

If money is needed then go for the bigger stuff - tax capital gains fully rather than at 50% income inclusion, for example. Then we are talking about billions per year rather than a couple hundred million.

I won't bother to lay out the math on this since you obviously won't trust it as your petty ad hominem has made clear.

[msj]

You need to understand the difference between CPP, OAS, and GIS. I'm practically Marxist and even I wouldn't take people's CPP away.

The interesting thing about his proposal is that it would destabilize CPP.

Self-employed people like me would become fearful. If you are starting at $200,000 now then when I retire it may only be $100,000 and that may effect me.

Therefore, I will go back to taking dividends out of my company and no longer paying into CPP.

There are probably more people who would think like this (and act upon it) than be effected by Big Guy's proposal (at least at the $200,000 level) so the accreted effect on the CPP fund would be interesting if we could find an actuary who could do the math!

[Big Guy]

...

I won't bother to lay out the math on this since you obviously won't trust it as your petty ad hominem has made clear.

Thank you responding to my "petty ad hominem". I will soon forward what I feel your advice is worth.

[msj]

Thank you responding to my "petty ad hominem". I will soon forward what I feel your advice is worth.

I note your response and understand why you don't want to discuss something for which you are so ill equipped to carry on a discussion so that you must divert discussion in this way.

By all means, let's discuss the numbers.

If you don't feel comfortable doing this then how about asking questions that can lead to both of us thinking about this issue and the numbers in different ways?

Edited April 25, 2016 by msj

[Big Guy]

I note your response and understand why you don't want to discuss something for which you are so ill equipped to carry on a discussion so that you must divert discussion in this way.

...

Why would you want to discuss anything with someone who is so "ill equipped". I would also assume that someone like yourself, whom I assume feels they are "well equipped", and whose professional expertise and time should then demand premium payment would so graciously part with that valuable advice for free.

This "ill equipped" individual will continue to charge the same price for his professional consultation using anonymous boards as those who consider themselves as expert in their fields.

Why would anyone who you demean and refer to as "ill equipped" and whose views you consider to be "petty ad hominem" be interested in continuing any discussion with someone who I consider to be rude? I try to not get involved in sharing points of view or discussions with posters who I consider to be unable to communicate in a civil matter. I misread your attitude and apologize for wasting your time and my time.

I consider this consultation completed and the cheque to cover what I value for your advice and valuable time is in the mail.

Edited April 25, 2016 by Big Guy

[msj]

Why would you want to discuss anything with someone who is so "ill equipped". I would also assume that someone like yourself, whom I assume feels they are "well equipped", and whose professional expertise and time should then demand premium payment would so graciously part with that valuable advice for free.

This is just odd.

What advice have I given here?

How to split pension income?

How to calculate back of the napkin style the savings from clawing back CPP as you have proposed?

Knowing top marginal tax rates?

I mean really? That is some kind of trade secret?

Also, I find your implied judgement of how I choose to spend my spare time condescending, to say the least.

Why would anyone who you demean and refer to as "ill equipped" and whose views you consider to be "petty ad hominem" be interested in continuing any discussion with someone who I consider to be rude? I try to not get involved in sharing points of view or discussions with posters who I consider to be unable to communicate in a civil matter. I misread your attitude and apologize for wasting your time and my time.

I consider this consultation completed and the cheque to cover what I value for your advice and valuable time is in the mail.

My apologies for "demeaning" you.

You're right, no excuses for doing this. The "he started it first with his petty ad hominem attack" is not an excuse so I retract that comment.

Edited April 25, 2016 by msj