Entering Assets in the Projections
The Assets page is divided into 2 sections, the Capital Assets section and the Real Assets section. We'll begin by covering how to add a Capital Asset (e.g., bank and investment accounts) to your plan and then move on to Real Assets (e.g., home, cottage, rental property) at the bottom of this article.
In this article:
Entering Capital Assets
The Capital Assets section includes six tabs where you can input details about your client's accounts. The five tabs include Assets, TFSA, RRSP/RRIF, DCPP/LIRA/LIF, FHSA, and Employer Matching.
Under the Assets tab, you can enter various assets such as bank and investment accounts. Once you have added assets to the table, a column will be created for each asset on the Planning page where you can enter specific Contributions or Withdrawals, or view the automatic Contributions and Withdrawals performed by Snap Projections.
You can create individual or group TFSA, RRSP, and Non-Registered assets. You can also create FHSAs and DCPP accounts in this section. RRSP accounts will convert to RRIF accounts at the designated conversion age under the RRSP/RRIF tab on this page. Similarly for LIRA to LIF accounts the conversion and unlocking can be done under DCPP/LIRA/LIF tab. These tabs are detailed in the numbered sections below.
To add a new asset, click Add Capital Asset. Enter the asset details such as the Type of account, Value, and asset allocation under the Assets tab, you can also input the Cost in the case of non-registered assets.
A non-registered account with a $0 value will be added to new projections by default. This account provides a placeholder for automatic contributions in the projections when there is a surplus of cash. If desired, you can keep this account, edit the Value, Cost, and Asset Allocation of this account, or delete this account using the trash can icon under the Actions column and add your own.
If you see a red notification "Cannot model capital gains without equities", you can either adjust the Cost of the non-registered asset to equal the Value of the asset or assign a percentage to Equity under the Asset Allocation.
You can enter the Cost for an account that consists of all three asset classes. However, the cash and fixed income portions of the non-registered assets generate interest income only in the projections. Equities are the only asset class that can generate capital gains in Snap. The ACB entered here will be taken into consideration for the capital gains calculations, even if there are cash and fixed income portions of the account.
You can access the Portfolio Settings (by selecting Scenario Setup -> Settings -> Portfolio) and further specify the Equity Return Allocation between capital gains, and foreign and Canadian dividend-producing stocks.
Once you have entered information under all of the columns for this asset in the table, it will be automatically Saved.
You can re-order the assets in the table by using the grey arrow under Actions to move an asset up in the table. Then click Save Order.
Under the TFSA tab, you can enter the unused TFSA contribution room. By default, Snap assigns the maximum yearly contribution amount for the first year of your projections. (For example, $6,000 for 2022). The default settings are a good starting point, but the past unused contribution room can be input here to allow for higher TFSA contributions in the projections.
Snap will limit TFSA contributions in the first year of the projections to the TFSA Contribution Room amount that is entered here. Please see How to Maximize TFSA Contributions for more detail on setting up contributions to the TFSA in your projections.
Under the RRSP/RRIF tab, you can set the available RRSP contribution room, enter any pension adjustments related to DBPPs, base the minimum RRIF withdrawals on the age of the younger spouse, and set the RRSP to RRIF conversion age for each account.
The initial settings for this example client were based on $90,000 of Employment Income and the start year of 2024. The RRSP Contribution Room for 2024 was set to 18% of $90,000 automatically, $16,200. The default settings are a good starting point, but you can update the individual's unused contribution room based on their Notice of Assessment.
You can also set the RRIF Conversion Age for each RRSP individually here. If the individual already has a RRIF account, simply enter a Conversion Age that is 1 year before their age in the first year of the projections. You can stagger the conversion of assets by setting different values for the Conversion Age. In the projections, RRIF income will start in the year following the Conversion Age.
Under the DCPP/LIRA/LIF tab, you can base Minimum LIF withdrawals on the age of the younger spouse and indicate any unlocking for each account.
Based on the jurisdiction of the LIRA or DCPP account, it may be possible to unlock a percentage of the funds upon conversion to a LIF account and transfer the unlocked portion to an RRSP/RRIF account.
Similar to the RRSP/RRIF Conversion Age above, you can set the Conversion Age for each LIRA/DCPP account individually.
Under the FHSA tab, you can adjust the default settings that Snap uses to determine the available Contribution room for the FHSA each year of the projection. The lifetime maximum contribution is $40,000. If the client has made contributions in previous years, you can input the total in the FHSA Lifetime Contributions field. If the client didn't contribute in a previous year that they were eligible to do so, up to $8,000 can be carried forward and entered in the FHSA Carryforward Room for 2024 field.
There are several rules related to when a FHSA must be closed. The First FHSA Opening Age field allows us to determine if the account must be closed in the projection based on the 15-year rule.
If you're modelling the purchase of a first home in your projection, you can add the Real Asset following the steps at the bottom of this article. Once you've added the property to the plan with a Future Purchase Age you can then select the Real Asset in the First Home dropdown. Snap will then automatically make a Qualifying Withdrawal from the FHSA and apply it toward the cash flow required for the home purchase.
Additional information can be found in the First Home Savings Account (FHSA) article.
Employer Matching Tab
For group assets and DCPPs, under the Employer Matching tab, you can specify a percentage of the selected employment income or other income that is contributed to this asset annually by employees and/or employers. On the Planning page, the asset will begin as a group asset and then will be converted to a regular individual asset when the linked employment income ends.
First, select the Employment Income to link to this asset, and then you will be able to enter employee and/or employer contribution percentages.
On the Planning page, you will see the accounts you have created on the Assets page listed under the Capital Assets section. Note that the Principal value displays the end-of-year value for each account after any contributions or withdrawals have been made and the rate of return has been applied for the year.
Entering Real Assets
The Real Assets section contains a table that allows you to enter real, tangible assets such as primary and secondary residences and rental properties. These assets can be existing assets or those that are planned to be purchased in the future. You can also enter a date to sell the property and specify whether the property would be subject to capital gain tax.
To add a new Real Asset click Add Real Asset. Once you have entered data for each required field, the asset will be automatically saved. You do not need to enter a Future Purchase Age if the client already owns the property.
The Planning page displays the property with the end-of-year value after any appreciation has been applied. For jointly owned assets, the value for the property is split evenly and half of the value is displayed for each spouse.