So… just to add a bit of a conclusion to this, and thank you all for your comments, by the way, ...what I really hope is that I may re-inspire a wee bit of additional banter on this idea that I presented...
Brian, since you were most vocal... here is the math as I see it.. .just to keep it simple, the high income earner ($125k) is in a 50% tax bracket and the low earner ($35k) is at 20%... and again, to keep it simple...they both have the ability to deposit $2,000.00 into an RSP... the “rich” guy, who writes the books, gets a $1,000.00 refund, net cost, $1,000.00... the “poor” guy who has to follow the rules gets a $400.00 tax refund, net cost $1,600.00... the conclusion, again, as I see it, ...the “poor” guy or gal, has to pay more out of his pocket to have a retirement fund... that’s discrimination... why does the “poor” person have to pay more to retire?... or get a tax deduction???...
...and for the math...$2,000.00 per annum invested for 25 years at 8% creates a whopping $157,908.00 financial reserve... oh wow... and to conclude this, if you were “lucky” to get a return of 4% on your capital in 25 years, I mean even if you were even able to get an 8% return for the growth in the first place, you would add $6,317.00 per year or $526.36 per month, ...take me to the French Riviera kinda dough...but wait...the 20% in taxes...FIRST...the government takes it’s share, the first $1,263.00 leaving a staggering $5,053.00 or $421.00 per month...what with CPP and OAS you’re living the Canadian dream...
...oh, and by the way, I’m not going to do the math for the “rich” guy... and if I was going to do any additional math... I would do it like this, ... I suggest that the “poor” person is saving .057% of their income and the rich person is saving .016% of their income... concluding that the “poor” person has to have more discipline than the “rich” person to save for their retirement...
Copyright 2013 Richard M. Kiernicki. All rights reserved.
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