Quote:
Originally Posted by RichieRich
lastly (for this evening) most of ya'll may find this link useful:
https://www.theglobeandmail.com/inve.../cpp-benefits/
Basically helps you determine when taking CPP makes sense, or to compare where the crossover point is for total monies taken. Of course don't forget taking CPP is added to your taxable income so it also has an affect there.
I back-calculated the approx CPP internal rate of return (ie if you defer year over year for a higher rate down the line) and it was around 8%'ish. So that means if you take it early and invest it for yourself (and your heirs if you croak), you need to be making more than ~8% return. |
I think this is the wrong way to look at CPP.
CPP is a guaranteed investment, effectively an inflation adjusted annuity. By having this annuity it allows you to take more risk in other investments and generate greater returns there. It’s your longevity hedge. So in evaluating its value one should look at the cost to purchase a similar product if it’s even available.