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The Fed Just Hiked Rates. Here's What It Means for Your Canadian Mortgage.

  The U.S. Federal Reserve raised its benchmark rate 25 basis points yesterday — the first hike in three years. The Bank of Canada hasn't moved. That gap is now the biggest story in Canadian personal finance. MoneySavings.ca  |  September 17, 2026  |  Canadian Money Brief Yesterday afternoon, the Federal Open Market Committee voted 12-0 to raise the U.S. federal funds rate by a quarter point, pushing it to a target range of 3.75%–4.00%. It's the Fed's first rate hike since July 2023, and Chair Kevin Warsh made clear it almost certainly won't be the last. The Bank of Canada, by contrast, has held its overnight rate at 2.25% through seven straight meetings. It doesn't decide again until October 28. For Canadians with a mortgage, a renewal coming up, or a home equity line of credit, this matters more than it might look at first glance. 3.75–4.00% New U.S. Fed Rate 2.25% Bank of Canada Rate 1.625% Rate Gap (vs. 1.375% yesterday) ~71.5¢ Loonie (post-hike low) What th...
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Preserving a Nest Egg: Strategic RRSP Withdrawals Explained



When retirement arrives, the challenge shifts from saving money to spending it wisely. For someone sitting on nearly $3 million in savings, the key question is how to draw down their RRSP in a way that minimizes taxes while ensuring her wealth supports her lifestyle for decades.

1. Start Withdrawals Before Age 71

  • RRSPs must be converted to a RRIF (Registered Retirement Income Fund) by age 71.
  • If someone waits until then, mandatory minimum withdrawals could push her into the highest tax brackets.
  • By starting withdrawals earlier, she can smooth out her taxable income over time, reducing the risk of large tax bills later.

2. Delay CPP and OAS

  • Delaying Canada Pension Plan (CPP) and Old Age Security (OAS) until age 70 increases benefits significantly.
  • This allows someone to rely more on RRSP withdrawals in their 60s, keeping taxable income balanced and avoiding OAS clawbacks.

3. Use a “RRSP Meltdown” Strategy

  • Gradually withdraw RRSP funds while offsetting taxes with interest deductions from investment loans or prescribed annuities.
  • This reduces RRSP balances before mandatory RRIF withdrawals kick in, lowering taxable income in later years.

4. Maximize TFSA Contributions

  • Withdraw from RRSPs and re-contribute to a Tax-Free Savings Account (TFSA).
  • Growth inside a TFSA is tax-free, and withdrawals don’t affect government benefits.

5. Leverage Pension Income Splitting

  • If someone has a spouse, splitting RRIF income can reduce overall household taxes.
  • This strategy ensures both partners stay in lower tax brackets.

6. Sequence Withdrawals Wisely

  • General rule: Non-registered accounts first, then RRSP/RRIF, then TFSA last.
  • This order allows taxable accounts to be drawn down while tax-sheltered accounts continue to grow.
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