My mom went to go see a new financial advisor the other day as she is 65 and some of her RRSPs are coming up for renewal.
She doesn't have much RRSP's and didn't make much while working. Her government supplements per month will maybe be around 800 a month. She has about 12k coming up for renewal at the end of the month. The advisor recommended that she withdraw the 12k and put it in a TFSA. He explained that their will be a 30 percent withholding tax on that amount.
Since her monthly net income will probably not reach 20k she will get that withholding tax back when doing her taxes the next year. He suggested is as once she starts taking out all of her RRSP in the next 3 years she will be eligible for more government assistance once they see she has no RRSP left.
Can anyone validate this or offer better advice?