Reader Question:Do I Have To Share My RRSP With My Spouse When I Get Divorced?

Another reader of the Canadian Budget Binder blog asked the question, “Do I have to Share my RRSP with my Spouse When I get Divorced”? In Ontario there is the Family Law Act. In simple terms all property acquired after the date of marriage, up until the time of marriage breakdown is deemed to be the property of both parties. The ownership of the property is not a factor. So in short each person is entitled to 50% of the total family property. There are certain exceptions like the family home that was brought into the relationship or received as a gift or inheritance. However to keep things simple we will ignore this. RRSP’s, Stocks, Bonds, Pensions, are all subject to being included under Family Law. So if one spouse had a significant RRSP and the other nothing then the spouse with nothing would be entitled to 50% of the spouse’s RRSP. Note: the courts adjust the value of the RRSP down, by the amount of withholding tax that would be payable if the RRSP were cashed in. So the figure used is less than fair market value of the RRSP. To understand this fully the courts ask each person […]

My Biggest Money Mistake-Co-Signing and Taking On Debt

Money Mistakes aren’t always in your face but we learn from these mistakes to make it right the next time. There are many reasons people fall into debt but there are more reasons about why they should get out of debt even if that means fighting for your legal rights. You don’t need to make millions to use a budget but you do need to see the numbers. One of my fans contacted me with a story she wanted to share about her biggest money mistake. Not everyone is willing to step up to say “this is what happened” and “this is what I had to do to fix it“. Julie took steps to get back on track and I hope others can learn from her story and not be taken advantage of. Take your failures and make them a success story like Julie. Here is Julie’s Story…… Hello Mr. CBB! When I separated from my ex-husband, I had to file for bankruptcy. I wasn’t mismanaging funds but what landed me in hot water was failure to protect myself from love and money. This chapter in my life has taught me to become fairly self-reliant whilst living on no credit. Great lessons learned […]

Rebuilding Life and Finances After Surviving A Divorce

Rebuilding life and finances after surviving a divorce can be a long road but the road has to start somewhere. When we get married it’s supposed to be for life, in sickness and in health, for richer or poorer but we know actions speak louder than words. We live our lives as if tomorrow will be the best day we have ever lived until a marriage breakdown occurs. Money fights and Money problems being the top reason people divorce yet this is something that doesn’t really need to happen. With the rising cost of living and families turning to credit and spending more than they earn thus keeping some in debt denial it’s no surprise marriages fail. The walls are crumbling for some couples faster than they are being built. Most families need two incomes just to keep the roof over their heads, food on the table and clothes on their children’s backs. People are struggling to find work after massive lay-off’s, disabilities and upon graduating University and College. If you think acting like Mr and Mrs. Money Bags is the best way to be the talk of your friends, think again. Not all divorces end because of money and really no one can […]