Retirement Glossary

CPP — Canada Pension Plan

CPP is a taxable retirement benefit based mainly on a person's CPP contributions during working years and the age when benefits start.

OAS — Old Age Security

OAS is a taxable federal pension for eligible seniors. The amount can depend on age, years of residence in Canada after age 18, and income level.

GIS — Guaranteed Income Supplement

GIS is an income-tested monthly benefit for eligible low-income OAS recipients. CPP, pensions, RRSP/RRIF withdrawals, and other income used in the GIS calculation can reduce it, while TFSA withdrawals generally do not. Actual payments are generally recalculated each July using income from the previous calendar year.

TFSA — Tax-Free Savings Account

A TFSA is an account where investment growth and withdrawals are generally tax-free. TFSA withdrawals usually do not count as income for OAS recovery tax or GIS calculations.

RRSP — Registered Retirement Savings Plan

An RRSP is a tax-deferred retirement savings account. Contributions may reduce taxable income, but withdrawals are taxable.

RRIF — Registered Retirement Income Fund

A RRIF is commonly used after converting an RRSP in retirement. RRIF withdrawals are taxable and minimum withdrawals are required after the RRIF starts.

RRIF minimum withdrawal

The minimum amount that must be withdrawn from a RRIF each year once minimum-withdrawal rules apply. The withdrawal is taxable even if the money is not needed for spending.

OAS recovery tax / OAS clawback

A repayment of OAS that can apply when taxable income is above the annual threshold. It reduces the net value of OAS for higher-income seniors.

Inflation

The rate at which expenses rise over time. The estimator projects future expenses using inflation instead of assuming today's expenses stay unchanged.

Investment return

The expected growth or loss on savings and investments during retirement. Returns can help assets last longer, but actual market results can be higher or lower.

Cash reserve

Money kept aside for emergencies and near-term needs. The estimator separates a recommended reserve from long-term retirement assets.

Survivor risk

The risk that income changes after one spouse dies. One OAS payment stops, CPP may change, and workplace pensions may continue at a reduced survivor percentage.

Net spendable income

Income available to pay expenses after estimated tax. This is more useful than gross income because taxes reduce what can actually be spent.

Monthly shortfall / surplus

The difference between net spendable income and essential monthly expenses. A shortfall means savings withdrawals are needed; a surplus means income is expected to cover expenses.

Essential monthly expenses

Recurring costs needed to maintain the household, such as housing, utilities, food, insurance, transportation, internet, cell phones, and medical costs.

Downsizing

Selling a current home and moving to a less expensive property or rental. In the estimator, downsizing can reduce monthly housing costs and release home equity into cash.

Net cash released

The estimated cash left after selling a home, paying the remaining mortgage, selling costs, buying costs, moving costs, and any replacement property purchase.

Mortgage closure on sale

When a property is sold, the remaining mortgage is usually paid from sale proceeds. The estimator stops mortgage payments after the downsizing or sale year.

Withdrawal order

The sequence used to draw from cash, TFSA, and RRSP/RRIF assets when income is not enough to cover expenses. Registered withdrawals are taxable and may reduce GIS, so the order can affect taxes, benefits, and how long assets last. Comparing withdrawals before and after OAS/GIS begins can reveal important trade-offs.

Tax estimate

A simplified estimate of federal and Ontario income tax on taxable income such as CPP, OAS, pensions, and RRSP/RRIF withdrawals.

Savings durability

An estimate of how long retirement assets last under the selected assumptions. The result may show the year assets run out or confirm that the target age is reached.

CCAC — Community Care Access Centre

A former Ontario organization for coordinating home and community care, later replaced by LHIN home-care services and now Ontario Health atHome.

CIRO — Canadian Investment Regulatory Organization

Canada's national self-regulatory organization overseeing investment dealers, mutual fund dealers, and trading activity on debt and equity marketplaces.

CRA — Canada Revenue Agency

The federal agency that administers Canadian tax laws and many tax-related benefit programs.

DC — Defined-contribution pension plan

A workplace pension in which contributions are invested for the member and the eventual retirement income depends on contributions, investment results, fees, and withdrawals.

DIY — Do it yourself

Completing a planning or administrative task without professional assistance.

FSRA — Financial Services Regulatory Authority of Ontario

The Ontario regulator responsible for several financial sectors, including provincially regulated pension plans, insurance, and mortgage brokering.

FX — Foreign exchange

The conversion of one currency into another and the related exchange rate, cost, or financial risk.

GIC — Guaranteed Investment Certificate

A deposit investment that generally returns principal plus interest after a specified term, subject to the issuer's conditions.

GST/HST — Goods and Services Tax / Harmonized Sales Tax

Federal consumption taxes charged on many goods and services. Eligible lower-income households may receive the GST/HST credit.

ID — Identification

Information or documentation used to establish identity. Caller ID displays available information about an incoming caller but can be spoofed.

IRS — Internal Revenue Service

The United States federal tax agency.

LHIN — Local Health Integration Network

A former Ontario regional health organization whose home-care functions are now provided through Ontario Health atHome.

LTC — Long-term care

Accommodation, personal support, and nursing care for people who need substantial ongoing help with daily living.

MFA — Multi-factor authentication

A login method requiring more than one form of verification, such as a password plus a temporary code.

ODSP — Ontario Disability Support Program

An Ontario program providing income and employment supports to eligible people with disabilities.

OHIP — Ontario Health Insurance Plan

Ontario's public health-insurance plan for eligible residents.

OSDCP — Ontario Seniors Dental Care Program

An income-tested Ontario program providing dental services to eligible seniors.

PBSA — Pension Benefits Standards Act, 1985

The federal law governing federally regulated pension plans.

POA — Power of attorney

A legal document authorizing another person to make specified property or personal-care decisions.

QPP — Quebec Pension Plan

Quebec's public contributory pension plan, which is separate from but coordinated with the Canada Pension Plan.

RHRA — Retirement Homes Regulatory Authority

The organization responsible for licensing and regulating retirement homes in Ontario.

URL — Uniform Resource Locator

The address used to locate a page or other resource on the web.