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Wealth Builder
Gordon Pape writes on common-sense wealth-building strategies.

By Gordon Pape  | Friday, December 28, 2018

Q – In a recent tax tip article in the paper, it advised to withdraw funds from a TFSA in December and then add them back to the next year’s contribution limit. It didn’t explain why this would be beneficial. Is it? If so please explain. – Barry D., Duncan, BC

A – The only tax advantage I can think of is a situation where you need some cash in December (Christmas bills and all) and you don’t want to receive it from a taxable source, such as a RRIF, RRSP, or, if you’re a business owner, salary or dividends. A TFSA withdrawal provides the cash you need at the time on a tax-free basis. The withdrawal amount will then be added to your contribution room in the New Year. – G.P.

Converting RRSP

Q – My wife has turned 71 this year and has to convert her $300,000 RRSP to a RRIF. I was going to use the Mawer Balanced Fund. What is your current opinion of this fund? Also, with the strong emphasis on bonds in a rising rate environment, would my wife be better to own pure equity funds (no bond portion) and put maybe 50% into GICs or cashable GICs. Look forward to your answer. – Robert B.

A – I like the Mawer fund and continue to recommend you discuss it with your advisor as a possible addition to a diversified portfolio. It has posted above-average results over all time frames. But your idea of an equity portfolio supported by laddered or cashable GICs would also work in a rising interest rate environment and would have less downside risk than bonds. – G.P.

Gordon Pape is one of Canada’s best-known personal finance commentators and investment experts. He is the publisher of The Internet Wealth Builder and The Income Investor newsletters, which are available through the Building Wealth website.

For more information on subscriptions to Gordon Pape’s newsletters, check the Building Wealth website.

Follow Gordon Pape on Twitter at and on Facebook at

Notes and Disclaimer

© 2018 by The Fund Library. All rights reserved.

The foregoing is for general information purposes only and is the opinion of the writer. Securities mentioned carry risk of loss, and no guarantee of performance is made or implied. This information is not intended to provide specific personalized advice including, without limitation, investment, financial, legal, accounting, or tax advice. Always seek advice from your own financial advisor before making investment decisions.


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