2022 January Update
Happy New Year!
Well, you’ve had a few weeks of 2022 and we’re about to embark on what Julia likes to call the “real” new year – the lunar new year, which lands on February 1st this year. We like to give ourselves this time frame between the solar new year and the lunar new year to actually prepare ourselves for the next few seasons. It’s not actually reasonable to expect that you’ll be able to wake up on January 1st, prepped and ready for the next 12 months, so we think it makes far more sense to use the month of January to reflect on last year, and consider your plans for this one.
At Spring Plans, we’ve been doing exactly that throughout this month, and we continue to make changes to better our practice and the services we provide to you. To that end, the last week of January is dedicated to our annual strategy retreat, where we prefer to get together in person (which has been tough through this pandemic) to learn from the past and use that information to create a great future.
We’ve already made a few significant changes, and one that you, if you’re a regular reader, may notice in this newsletter! In 2021, we reduced the number of articles we produced each month, and in 2022 we’re going to reduce this even more. We want to focus our time and energy on giving our clients what they value most, and we’ve determined through discussions and surveys that this is the planning work we do for each individual, couple, and family.
We absolutely love writing, and want to make sure we’re giving you timely and useful information, so we’ll be writing a newsletter each month, but we’ll be reducing our feature articles to quarterly (or, if something really exciting happens, there might be a random, untimed one). In previous years, we’ve written about your values, your experiences, and design thinking. We hope that these articles remain “evergreen” and useful for you, so we’ll continue to share them in each monthly newsletter.
On your end, this new year brings with it new account contribution limits, pension income, and pension contributions, which we’ve summarized for you in the below table. We also want to remind you of important dates to pencil into your calendar. If there’s anything you need to be in touch with us about prior to these dates, please do contact Lindsay as soon as possible so we can ensure we’re available to help you out!
|2021 RRSP Contribution Deadline||March 1, 2022|
|2021 Personal Tax Filing Deadline||April 30, 2022|
|2021 Income Tax Payment Due Date||April 30, 2022|
|2021 Self-Employed Tax Deadline||
June 15, 2022
*but the tax payment due date is still April 30
Demand on accountants in Canada has increased dramatically over the past few years, at the same time that the labour shortage has impacted pretty much every single business. For these reasons, we highly recommend you get your tax slips to your accountant as soon as humanly possible. If you’re collecting receipts for things like medical expenses, home office expenses, and business costs, we also recommend that you take the time to organize them and put them into a spreadsheet, rather than giving your accountant the old shoebox full of crumpled paper. Given the time constraints they’re dealing with, that’s likely going to cost you more than it used to.
|TFSA Contribution Room 2022||
You can contribute this amount, plus any contribution from previous years that you haven’t used
|RRSP Contribution Room 2022||
18% of your earned income up to a maximum of $29,210
You can contribute this amount, plus any contribution from previous years that you haven’t used. Dividends and rental income do not count as earned income.
|Yearly Maximum Pensionable Income (YMPE)The maximum income against which you can contribute to CPP||$64,900|
|Contributions to CPP (Employees)||
5.7% of your income up to the YMPE
Your employer contributes the same amount
|Contribution to CPP (Self Employed)||
11.4% of your income up to the YMPE
You contribute the employer & employee amounts
|Contributions to EI||
Maximum insurable earnings: $60,300
Employee Rate: $1.58 per $100 insurable earnings (max $952.74 for the year)
Employer Rate: $2.21 per $100 insurable earnings (max $1,332.63 for the year)
|Maximum CPP Pension Income (Age 65)||$1,253.59 per month (indexed annually)|
|Maximum OAS Pension Income (Age 65)||$642.58 per month (indexed quarterly)|
Best wishes from all of us for a year filled with good surprises in 2022. If January hasn’t gone exactly as planned, remember you’ve got another opportunity to try again in February (and there are all kinds of other “new year” celebrations throughout the year). Calendars are human constructs anyway – you have endless opportunities to step back, reframe, and try again at living your life, well spent.
Julia will be speaking at two events in the coming weeks:
- January 26 at 9:30 PT / 12:30 ET: Financial Confidence Advisors. Join Julia Chung as she speaks with Ivy Woo John about building confidence and empowering women when it comes to financial management and planning. This event will be hosted on January 26th, you can register for the event here.
- February 22 at 9:30 PT / 12: 30 ET: Genus Capital “Retiring with Purpose”. Join Julia Chung and Sue Talbot on February 22nd for a discussion about the delicate art of retiring with purpose. This event will include insightful conversations about purposefully designing your life after work and building a retirement income plan that will actually work for you. Register for the event here.
We’ll be hunkering down at our annual strategic planning retreat from January 27 through 31st, so don’t expect to hear a lot from us during that time! Sandi will be taking February 9th to celebrate her birthday with her family, and we’ll all be spending February 21 celebrating Family Day, Heritage Day, Islander Day, and Louis Riel Day (depending on the province).
“Free” Fridays remain booked permanently in our calendars. These days are free to us at Spring in the sense that they are our opportunity to work on becoming better planners, whether through collaboration and discussion, education, research, or even a little down time. It’s been a regular practice since the summer of 2017, and we will continue to set aside the time to become better versions of ourselves every week. Even 1% better is solidly worth it, because we know that will be reflected in the work we do for you.
Spring in the News:
Two years into the COVID-19 pandemic, many families have had to turn to private tutoring to keep their kids from falling behind, in this article by the Globe and Mail, Kathryn Mandelcorn shares her insight into how parents are budgeting for cost. Subscribers to Globe and Mail can read the whole article here.
Planning News Digest:
Our friends at Viive Planning are looking to gather insights from Ontarians who have gone through end-of-life planning processes with their loved ones. The goal is to uncover stories and deeper insights so these can be contrasted with current statistics on planning and death. If you would like to participate in their virtual workshop in February, hosted by independent third-party researchers, please sign up here. Information and insights will be anonymized by the independent researchers, and participants will receive a small token of appreciation for their time.
New estate laws are here, this article by O’Sullivans outlines all of the changes, and what to expect. Read more.
Feature from the Archives:
Learn how to achieve peace of mind through our value this month- safety and security. We go through how this value can show up for you in cash flow, portfolio management, risk management, and in your estate. Read more.
Never miss an update from Spring by signing up for our monthly newsletter here.
- 2023 May Update - May 10, 2023
- 2023 April Update - April 14, 2023
- A Recession Toolkit - March 30, 2023