Ian Moyer Logo

  • Home
    Home This is where you can find all the blog posts throughout the site.
  • Categories
    Categories Displays a list of categories from this blog.
  • Tags
    Tags Displays a list of tags that have been used in the blog.
  • Bloggers
    Bloggers Search for your favorite blogger from this site.
  • Team Blogs
    Team Blogs Find your favorite team blogs here.
  • Login
    Login Login form

The Bucket Solution™

Posted by on in News
  • Font size: Larger Smaller
  • Hits: 3634
  • Subscribe to this entry
  • Print

Considerations for structuring a retirement income plan

Retirement and estate planning can be overwhelming for those brave enough to take it on. Wading through the seemingly endless amount of available information on this subject can be daunting. Without a fundamental framework in place to help guide you through the process, you can end up getting lost. Below you will find such a framework we call, The Bucket Solution™. We use this tool with our clients, and we hope that readers of this post can benefit from it as well.



Think of your sources of retirement income as separate buckets. You have three: Annuities, Registered Assets, and Non-Registered Assets. Each of these buckets should have a distinct purpose. Annuities are a fixed income that pays a fixed expense. Registered Assets are easily accessible for emergencies and lifestyle expenses, and non-registered assets are tax efficient and optimal for passing on to the next generation.  

Bucket #1 - Annuities

Your annuity bucket is your first priority and includes Canada Pension Plan, Old Age Security, Defined Benefit Pension Plans, and annuities purchased from a life insurance company.  

An annuity is a fixed sum of money paid to someone at a pre-determined frequency (i.e. monthly), for the duration of his or her life. The ultimate purpose of an annuity is to shift the task of managing a lump sum of funds to a financial institution, which can better manage that risk. Income from an annuity bucket should be spent first, and should cover the fixed monthly expenses of a household in retirement. By eliminating the risk of running out of money, annuities allow recipients to enjoy their retirement—worry-free.

Bucket #2 – Registered Assets

Registered assets are your second priority and include investments like Registered Retirement Savings Plans (RRSPs), Registered Retirement Income Funds (RRIFs), and Tax Free Savings Accounts (TFSAs)

These investments have an important role in retirement and estate planning. They provide retirees with access to funds in an emergency. These funds have never been taxed, so retirees may want to consider gradually emptying this income bucket to avoid excessive taxation on death (from high minimum withdrawals and deemed dispositions).

Bucket #3 – Non-Registered Assets

Non-registered assets are the last priority and include investments , and GICs that are not tax sheltered.

Many retirees accumulate excess funds i.e. money not needed for necessities or comfort.  These excess funds tend to build up as non-registered assets. It is important to protect this bucket of assets because they will form the foundation of a family legacy, and should not be unnecessarily subjected to the probate process in Ontario.

These investments may be protected within an insurance contract. Insurance contracts can include segregated funds, term funds, life insurance policies, critical illness insurance policies, and annuity policies (including term fund, life and term certain policies).With appropriate planning, and a designated beneficiary, assets will pass outside the estate.

The Bucket Solution™ is a framework that helps create and prioritize the different sources of income required in a well balanced retirement and estate plan. If you would like to ask questions please comment below. If you would like to apply this concept to your own unique situation, give us a call, we'd be glad to hear from you.  



  • No comments made yet. Be the first to submit a comment

Leave your comment

Guest Wednesday, 21 April 2021

Contact Information


Phone: 1 519 485 5801

Toll Free: 1 800 565 5444

Fax: 1 519 425 1207

Follow Us

© 2012 Ian C. Moyer All Rights Reserved - Website Designed by Akira Studio Ltd.