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The unbearable weight of bureaucracy

The unbearable weight of bureaucracy

Yesterday, a friend of mine came over so I could help her work on her own disability application. I don’t want to discuss her medical concerns here but I feel that she was rejected for very poor reasons so she is currently working on contesting the decision. I sent her home with my personal forms in the hopes that they would be helpful with wording.

Four years ago, I retired permanently on LTD (vs. the STD I had been on for the 2 years prior)

Unfortunately, the barrier to many things is bureaucracy. We have a joke in our family that I am the queen of cutting through red tape. I can stay on the phone for hours, hold music is my favourite jam. The reality is that for most folks, this is an absolute nightmare. Trying to manage everything from subscriptions to telecommunications companies to (the worst of the worst) insurance companies is so daunting for folks that I don’t blame them for putting it off.

One of my most brilliant friends got so overwhelmed during her partner’s treatment that they just paid the bills rather than fight with health insurance (they are in the US). It’s a sad fact that when you are the least able to manage the stress of dealing with an administration is when you require those skills the most. They are also lucky in the fact that the company has an entire department dedicated to managing health insurance claims on behalf of the employees because they recognized that it was cheaper to pay an entire department to do the work of waiting on the phone and writing email than it was to pay their top performers/earners to do it themselves. That is how much time and energy this busy-work entails: you need to add an extra layer of bureaucracy to get what you are essentially paying a fortune for.

On the flip side, you are also paying for companies to add an extra layer of bureaucracy in terms of hiring what is the equivalent of human firewalls to essentially deny claims all day. This has been studied and often if you have the time and energy to fight the insurance companies you will often win. Now AI is involved in claim denials, so that’s a fun layer of complexity. Who doesn’t LOVE the idea that our financial stability and credit rating are at the whims of computers?

Back to my friend who was denied. She has been on this journey for over a year. She has had referral after referral and has some real, physical issues that can be seen in tests. She was still denied because unfortunately, you need to have the right people at the helm filling out forms and you need to be detailed but succinct. Long essays about emotional stress doesn’t hold as much weight as point form facts. Here is a (non-exhaustive) list of things to keep in mind when you are filling out forms for a disability claim:

Don’t wait: get to work right away with tests, keep the dates and the names of who you have seen. Have a clear path showing that you are working on getting a diagnosis and improving your health.

Keep a personal record of your symptoms, the list of drugs you are taking and the tests you have had: unfortunately, you will constantly be asked about your symptoms by a variety of different health care workers. I found it easier to just keep all this information in a word document and add to it as I went along. If you have a symptom that just started to happen, make sure you note the month and year. Inevitably, when you are repeating the same information over-and-over again you will find you may forget some pertinent details. I have been told by professionals that they appreciated that I printed it all out for them so they could just copy the info they needed into their records.

Before you apply for LTD either have a diagnosis or have a clear path to getting one: when you are suffering through a health crisis the weight can make you feel like curling up on the couch and just wasting the days away. Please don’t do this. Be as engaged as possible with the process. You will be required to prove that you are doing due diligence in improving your symptoms.

Learn the lingo: it’s fasciculations, not “twitches.” It’s spasticity not “tight muscles”. When writing about your symptoms, try and use medical terminology so that you look informed.

Focus on what you can’t do, not what you can: we all want to feel capable and want to highlight the ways in which we are able to overcome adversity. But the insurance system (private or state funded) is designed to focus on what you can’t do, not what you can do. The way you word things matters! I have a friend who works for the agency that manages the provincial disability system (ODSP) and I asked him once for advice and he said the biggest thing people do wrong is that they word things in a way that makes it seem like they are mostly functional.
GOOD: I can’t get out of bed some days. I cannot button my shirt without assistance some days.
BAD: I can get out of bed most days. I can button my shirt most days.

If possible, have a specialist fill out the forms: a GP/Family Doctor does not carry the same weight as a neurologist or oncologist. Get as much concrete info as possible, and by concrete I mean actual tests that show there is something wrong with you. Above all, focus on what can be seen or what you can prove. An MRI report holds way more weight than a list of symptoms. Videos also can help without just relying on your say-so.

Which brings me to the worst one…
Sadly, no one cares about mental health: I know this is going to sting but please try and keep in mind that unless you have seen active duty and have PTSD, mental health challenges are notoriously difficult to prove. Only one person I know has ever received LTD was severely bi-polar and it had affected the workplace so severely AND they had to become an in-patient at a mental health facility to get it. You may be able to use STD to go off for a period of time with anxiety and depression but at least where I live I haven’t heard of anyone getting permanent LTD for it.

I know absolutely how anxiety and depression play a huge role in physical health as well and if I ruled the world things would be different. But I haven’t heard of anyone crafting an application with a huge mental health component winning a case.

Keep in mind that the people who review your case see thousands a week: be factual, be clear, don’t use flowery language, don’t talk about your feelings too much unless it is directly related (ie: a medication known to cause emotional turbulence), check your spelling/grammar, type vs. handwritten. Above all, remember that it’s not an essay, it’s a description of your symptoms/abilities/limitations/diagnosis.

In the end, it is up to you to prove that you have a sustained, long-term disability that prevents you from performing the necessities of life. Here are a few resources for Canadians that they may find helpful:

The CPP-D information and application: even if you are on a provincial or private disability benefit that would knock your CPP-D benefit to $0, if you have worked in the past it pays to apply anyway. To be on CPP-D means that it “stops the clock” on the years required for regular CPP benefits when you turn 65. If you have children, you also get a monthly amount for them as well.

Disability Tax Credit: this gives you a non-refundable tax credit for $9428 (2024).

The Registered Disability Savings Plan: this is worth it for everyone who received the DTC. Even if you don’t put a penny in, the government will put money in for you (you must get the DTC to get an RDSP).

The CPP Disability Channel: it hasn’t been recently updated but the info is still great.

The Resolute Legal Disability forums: this is an amazing searchable archive where you can get answers – or ask questions – to almost anything disability claim-related from private to public claims as well as government programs.

It is imperative that you do due diligence in exploring the programs and services available to you. I have private health insurance benefits but there are programs to help people in my province who may not be on ODSP but who have high prescription drug costs or who require mobility aids. It never hurts to spend a day seeking out any services or assistance in your community such as Meals on Wheels who not only service the elderly, but the disabled as well (temporary or permanently). There are myriad resources available to people at the city, provincial and federal level.

On scams and fear of starving in retirement

On scams and fear of starving in retirement

John Oliver is amazing and it is the reason why HBO hasn’t canned him, despite the fact he stirs up a lot of legal drama. He does to a lot of great public service segments and most are well worth watching. Here is a show he recently did on pig butchering scams:

Now, this is an important PSA for everyone because I think that a> yes, we – and by “we” I mean “everybody,” including me – are prone to getting scammed; b> we have no idea how far the rabbit hole goes with organized crime getting in on it; and c> how important it is to come forward and tell people about how easy it is to get scammed. It’s incredibly embarrassing to admit that it has happened to you but it is so important to let others know. Forewarned is forearmed, after all!

But I think what struck me in the comments section were people who said, “Can you imagine having enough money in the first place that you could lose $350,000!” followed by, “Interesting to see this comment!! I was like “wow, I can barely afford my rent, no savings for a rainy day and they’re losing more money than I can save in 4 lifetimes!!”

I automatically juxtaposed these comments to the hysterical headlines of “CANADIANS BELIEVE THAT YOU NEED OVER ONE MILLION DOLLARS TO RETIRE*” that has plagued Canadian media in the past year. This lead to a bunch of rebuttals including from one of Canada’s most adorable couples who retired early(ish) with “only” $300 000 in the bank.

The reality is that even though people are supposed to save for retirement, most of them don’t. Many people just live on the average amount of government benefits. So I thought it would be interesting if I calculated it up for a person who made minimum wage their entire lives but who worked until they were 65. This is both for the Canada Pension Plan (which we pay into) and Old Age Security (which is welfare for old people**).

They would get a total of $17658/pa or $1471.50 a month.

Since that number is under the $21624/pa cutoff for a single person for the Guaranteed Income Supplement, a single person working a minimum wage job could get up to $1065.47 on top of that CPP/OAS amount, bringing the grand total to $2536.97 a month or 30443.64/pa. It’s not a lavish lifestyle but it is definitely manageable, especially if you have some paid off real estate, social or co-op housing, live in a low-COLA area or have a bunch of roommates.

If you somehow also managed to save in a TFSA – let’s say, $100 000 total over your lifetime – you could probably also take out 4% tax free during your retirement that would also give you an extra $4000 a year that wouldn’t affect your benefits at all. Again, not a high-on-the-hog lifestyle but manageable.

OH? You don’t think someone who makes minimum wage could save $100000 over 30 years? I mean maybe not…but also it would only mean saving $1380 OR $115 a month in a TFSA at a 5% interest rate, which is not out of the realm of possibility, either.

We all know that this is over a long time span and programs come/go/and get cut by governments all of the time & the future is unknowable. While we tend towards the catastrophic, things can also get better if you are a good saver and/or make more money over your lifetime. They can also get worse if, say, you were a stay-at-home spouse with someone who died and left you nothing***. I think focusing on what you can control, today, is better than letting the panic freeze you into inaction or living your life in fear.

Naturally, this is all just a thought experiment. I am sure you could nitpick this example to death**** but it is an example of one particular scenario out of many and it’s just to show people that all is not lost if you don’t have a million dollars in the bank. I feel that it is counterproductive to push the ZOMG IF YOU DO NOT HAVE A MILLION DOLLARS YOU WILL HAVE TO EAT CAT FOOD narrative in a province where we seem to be ok with Welfare being $733 and Disability (ODSP) just $1308 a month.

Don’t let the bastards get you down.

*Depending on your demographic, according to this BMO survey.
**This is exactly what OAS and GIS are as it comes out of the current federal budget. If you want to watch your old, curmudgeonly uncle lose his goddamn mind at Thanksgiving, tell him that he is actually on welfare and stand back and watch the sparks fly!
****I put in 1975 as the birth year but the TFSA has only been around since 2009, par example.

What is our early retirement draw down plan?

What is our early retirement draw down plan?

What I’m reading & listening to
• Ok, this isn’t *reading* per se but it is a fantastic interview (podcast?) with Tim Ferriss and Morgan Housel. If you haven’t read Housel before, I highly recommend his work and his blog.
• Also in the *not reading* category is this podcast called Backlisted that I want to check out. I am not a podcast person generally but I am fascinated by old books that have fallen out of fashion.
Walks, tech and protein: parenting your parents.
• Are you the victim of the friendship recession?
The Best Laid Plans it is never too early to have your affairs in order, or quit working once you’ve reached your FI number.
Is an $100000 salary enough for a comfortable life anymore? (sub)

I generally enjoyed this article as it was more measured than most pieces. People were honest with their indulgences. Of course my brain honed in on this particular section though:

“In Edmonton, one of Canada’s most affordable larger cities, Liam Hudson has no trouble fitting all his expenses, aggressive savings and some travel into his household budget. The 32-year-old civil servant, who earns $106,000 a year, lives frugally. He drives a second-hand 2006 Buick Rendezvous. He tracks his spending meticulously. And he has made it a habit to put $250 every other week into his RRSP and another $100 into a tax-free savings account, even though he already has a generous government pension.”


He should be prioritizing his TFSA if he has a pension. Unless this guy plans to retire early & withdraw that money to live on, the RRSP forced draw down will be a nightmare in taxes at 71! The RRSP is a *tax deferral vehicle* which means that yes, every $1 you put into your RRSP you reduce your income (and tax payable) by $1 but eventually the government forces you to draw from it by a certain percentage every year (depending on your age) starting at 71. So if you have a full pension and suddenly find yourself being forced to withdraw from your RRSP you could potentially be pushing yourself into a higher tax bracket in retirement. Ouch!

“BUT,” you may think, “YOU PRIORITISE RRSPS!”

That is absolutely true! In fact, one of the things that is going to save us from paying capital gains when we sell the condo is that Mr. Tucker and I have a lot of contribution room left in our RRSPs. In Canada, contribution room rolls over indefinitely so you accumulate – and keep – your ability to contribute to your sheltered accounts over your lifetime. This is handy because if you make under $65000 it is generally not worth it to add money to your RRSP but since the amount rolls over and you keep it until you CAN use it, that $11700 (18% of your gross income to a max of $30780 in 2023) will stay on the books so that you can use it later and get the tax break. So when, say, you make $100000 20 years in the future, you can use it to reduce your taxes then.

Of course, some financial experts are saying that the TFSA should be prioritized first because it allows for tax-free growth over the course of your life, which makes sense for everyone. But we are leveraging the RRSP for now and the reasons are multi-fold:

– Mr. Tucker makes a good salary that is in a high tax bracket.
– Reducing his salary generally results in a high tax refund.
– The capital gains from the condo will result in pushing my yearly salary into the top tax bracket. So any reduction in that will mean less taxes go to the government.

It also helps that he plans to retire early so he can take money out of his RRSP when his income is zero and pay less taxes. There is no age penalty to draw down your retirement accounts in Canada.

So our plan is generally as follows:

When Mr. Tucker is retired and has zero income (we will be living on what I bring in), we will not touch the RRSPs until the kids are out of school. This is because of Canada’s Child Credit Benefit (CCB, colloquially known as the Baby Bonus). With his income being zero we can maximize the monthly CCB amount we get from the government until the kids are 18.

When The Youngest turns 18, Mr. Tucker will start to take out the Basic Personal Amount (BPA). This amount is currently $15000* for 2023. This is the amount every Canadian can make in income without paying taxes on it. You would only start paying taxes on $15001 and higher. Unfortunately, the BPA still lowers your monthly CCB payment as it is calculated using gross family income, which is why we are waiting until the kids are ineligible for the benefit. Interestingly enough, the TFSA maximum contribution is $7500 per person for 2023 which perfectly squares with the BPA of $15000. Yes, it will be more in the future but we will have to calculate it down the road.

The goal here is to minimize taxes down the road by moving money from the tax-deferred RRSP to the tax-sheltered TFSA when Mr. Tucker’s income is zero. Both buckets have the ability to grow tax-free over time but only the TFSA is tax-free when you take money out.

Of course, this is a generalization of the plan that will depend on the TFSA contribution room for us both, the amount of the RRSPs when we start to draw down as well as projections for the Canada Pension Plan, Old Age Security and Guaranteed Income Supplement. I suspect that we will end up drawing down the RRSPs and paying a bit of tax upfront so that we aren’t forced to withdraw minimums at 71. But because so much will change in the 20 years, it is ok to have a general plan for now and adjust as necessary.

Overall, the goal will be to reduce as many taxes as possible in retirement and maximize the benefits available. Who even knows what will happen with the TFSA and RRSP in the future? There is talk of eliminating the minimum withdrawal at 71 and so many things can happen between now and then that this is just a roadmap based on the current rules.

Life, nah, nah, nah, nah
In other news, The Eldest came down with covid over the weekend. The rest of us are all testing negative but she is holed up in her room convalescing. Thankfully, she is having an easier time of it than when she came back from Paris and was violently ill. That’s probably because she was in peak immunity due to having her booster two weeks ago!

Today, my plan is to get through some of my library books. Although I think a New Year’s Resolution should be for me to actually write down where I get book recommendations from (I always forget and so I can’t credit the source), I have surprisingly been unable to put The Lost Supper: searching for the future of food in the past down! I slogged through the intro and was worried that it would all be similarly boring but it hasn’t been! Despite being exhausted, I ripped through the first section and got through half of the second before I couldn’t keep my eyes open. He is such an engaging storyteller, interspersing fact with history. I am 1/3 of the way through it and will probably finish it today.

I got the new schedule for the condo fees today and so I am glad that the appliances are coming Friday and we can get the condo on the market. I know I say this every time I mention it but we are so done!

Have a lovely Monday, kids!

*Yes, he will have to pay taxes upfront on the amount that comes out of his RRSP that we will get back at tax time so he will actually be withdrawing more money here. But to simplify things for this example, I’ve stuck with that BPA amount.