Setup Instructions:
1. The RRSP balance is setup as 2M (can be for single or couple's amount), and this amount can be adjusted.
2. There are three options for the annual investment return assumption:
- FixValue: Enter your expected future annual return (fixed value).
- HistoryAve: Uses the average annual return of the S&P 500 over the past 50 years (fixed value).
- History20: You can choose any year from 1928-2005 as the starting point, and it will simulate 20 years of real historical data. For example, if you choose 1995, it will use the historical return data of the S&P 500 from 1995 to 2014.
3. For simplicity, the tax rate for RRSP account withdrawals is 30%.
4. The annual income tax rate for non-registered accounts is 17% (average rate, not margin rate).
5. The initial default annual inflation rate is 2.5%, which can be adjusted.
6. The initial default annual withdrawal percentage for the RRSP account is 5%, which can be adjusted.
7. The initial default annual return rate for non-registered accounts is 98% of the RRSP account return rate, which can be adjusted.
The yellow fields represent adjustable values.
For example:
Changing the annual withdrawal rate from 5% to 0% allows you to compare the growth of not withdrawing from the RRSP at all.
Or changing it to 8% enables rapid withdrawals (requiring a corresponding tax rate adjustment).
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