Inflation on the rise again at 3.3% | Page 2 | General financial discussion | Discussion forum

RetirEd said

Mordko: I don't understand why one would speak of "poor use" TFSA room - unless one is counting on equity returns to be reliably higher. That's not guaranteed, and for those of us past the ability to use current earnings to replace losses, it's a poison pill. Remember, TFSA losses can't reduce taxes.  

Equity returns are not “reliable”. They are volatile. But they will be higher than cash over a meaningful period of time (over 5 years) with very high likelihood.

So, whether stuffing TFSA with 100% cash makes sense depends on duration. If you already have more money then you can spend then 100% cash is fine. However the individual isn’t retired and the quoted numbers did not suggest that 100% cash option made sense. And getting back to inflation, while nothing is guaranteed, stocks invariably handle it better than cash.

mordko said

Equity returns are not “reliable”. They are volatile. But they will be higher than cash over a meaningful period of time (over 5 years) with very high likelihood.

So, whether stuffing TFSA with 100% cash makes sense depends on duration. If you already have more money then you can spend then 100% cash is fine. However the individual isn’t retired and the quoted numbers did not suggest that 100% cash option made sense. And getting back to inflation, while nothing is guaranteed, stocks invariably handle it better than cash.  

The individual is me and my rrsp and savings is coming close to 2 million and I will be 61 this year and have a defined benefit pension . You should keep your comments to yourself ,you know nothing.

mechone said

The individual is me and my rrsp and savings is coming close to 2 million and I will be 61 this year and have a defined benefit pension . You should keep your comments to yourself ,you know nothing.  

Mechone, you and I are in a similar position when it comes to bringing viewpoints to the site- people try to shut you down and dismiss your perspective. Lots of people, especially close to or retired, are not comfortable with stocks and other volatile investments. You obviously know a little to have put yourself in the strong position you are, others could learn something from that or go their own way.
There are ways to try to minimize the impact of inflation. However, my concern for you is try get some advice on minimizing the taxation impacts you may be headed for. In particular, the best option and timing for your rrsp draw down. Maybe there is still time before you retire or take the DB to get some tax advice. I’m in a similar boat on this topic. Keep sharing your perspective and evaluate what is offered on the site. Both can be good in some, but not all cases.