文章基本信息

标题：Pre-Retirement RRSP Withdrawals
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作者：Amin Mawani ; Suzanne Paquette
期刊名称：Canadian Tax Journal
印刷版ISSN：0008-5111
电子版ISSN：0008-5111
出版年度：2011
卷号：59
期号：2
出版社：Canadian Tax Foundation
摘要：Registered retirement savings plans (RRSPs) are tax-deferred plans used to save for retirement as well as for short-term precautionary savings. In this article, we examine taxpayers’ pre-retirement withdrawals from their RRSPs, using a cross-sectional analysis of a large sample of confidential tax return data from Quebec for the 2000 taxation year. We find strong evidence that taxpayers under 60 years of age make withdrawals in response to demographic shocks (divorce or separation, involuntary job loss, or death of a spouse), lumpy consumption needs, and negative income shocks, suggesting that RRSPs are used for precautionary or “buffer” savings as well as for income smoothing. Negative income shocks have the highest degree of association with withdrawals. Pre-retirement withdrawals are also more likely among RRSP planholders who have limited taxable investment income, indicating income needs. Furthermore, taxpayers who have used up a greater proportion of their RRSP contribution room are less likely to withdraw. Our results show that withdrawals are generally timed in low effective marginal tax rate (EMTR) periods. Surprisingly, however, 7.7 percent of taxpayers made pre-retirement withdrawals during periods of very high EMTRs. This may suggest that planholders either are unaware of their EMTR or are liquidity-constrained and therefore willing to withdraw money at a very high cost. Factors associated with the decision to withdraw are not the same as those associated with the amount withdrawn, suggesting a non-linear relationship between withdrawals and the retirement savings pool available. We also document substantial differences for taxpayers who participate in the home buyers’ plan (HBP), the most important being that HBP participants who are not persistent contributors are much more likely to withdraw than those who contribute regularly. Furthermore, while non-HBP participants seem to reduce the variability of their income through withdrawals, HBP participants do not seem to be motivated by or able to implement similar income-smoothing measures. Finally, while HBP participants are less price(EMTR)-sensitive, they are more sensitive to their level of income in addition to income shocks when making withdrawal decisions (more so than non-HBP participants).
关键词：RRSP n RETIREMENT PLANNING n RETIREMENT POLICY n EFFECTIVE INCOME TAX RATES n WITHDRAWALS