Financial Planning · Calgary, AB
Client Illustration
Prepared 02 Jun 2026
Position as of 07 May 2026
Prepared 02 Jun 2026
Position as of 07 May 2026
The Down Payment
Decision.
You put $58,000 down and financed a small CMHC premium — instead of gutting your RRSP or corporation to hit 20%. Here is exactly what that choice saved you, and where the alternatives would have left you.
Your position — 7 May 2026
Cash
$23,602
used $21,602
TFSA
$64,622
used $36,398 liquid
RRSP
$124,280
left untouched
Corporation
$72,663
left untouched
Down payment used
$58,000
cash + liquid TFSA
What the CMHC premium actually is
Purchase price$724,000
Down payment$58,000 · 8.01%
Minimum required down (this price)$47,400
Base mortgage$666,000
Loan-to-value91.99%
CMHC premium rate (90.01–95% band)4.00%
PST on premium (Alberta)$0 — none
Total insured mortgage$692,640
One-time CMHC premium
$26,640
Added to the loan, not paid in cash. It costs about $159/month of extra mortgage payment to carry.
Three ways to have funded this purchase
✓ The route you took
Keep It Invested
8% down, finance the CMHC premium. RRSP and corporation stay fully invested and compounding.
Cash cost today$26,640
Tax triggered$0
RRSP room lost$0
Capital still compounding$196,943
Premium is financed and shrinks every year as you pay down the loan. Nothing permanent is lost.
Alternative 1
Cash The RRSP
Withdraw from the RRSP to reach 20% down and dodge the premium — fully taxable as income.
Gross RRSP withdrawn$124,280
Tax triggered$44,741
RRSP room lost forever$124,280
Capital still compounding$61,318
The full RRSP barely covers the gap after tax — and the contribution room never comes back.
Alternative 2
Break The Corp
Liquidate corporate investments to fund 20% — triggers tax inside the corp AND on the way out to you.
Corp balance available$72,663
Gap to fill at 20%$86,800
Shortfall vs. gap−$14,137
Double-tax dragCorp + personal
The corporation can't even cover the gap on its own — and draining it stops the compounding that funds your future.
Where each route leaves you
Invested capital over time
RRSP + corporation, compounding at the assumed return. The gap is permanent.
Cost to "save" the premium
What avoiding the CMHC premium actually costs today.
You financed a $26,640 premium to keep $196,943 compounding into $845,355. The alternative was paying $48,825 in tax and giving up roughly $578,000 of growth — to save that same $26,640.
Assumptions — drag to test your own
Your stated payment
$2,018.34
accel. bi-weekly — implies ~5.05%
Model payment — Route A
$2,053.95
accel. bi-weekly at current inputs
Model payment — 20% down
$1,717.40
no premium, smaller loan
Payment difference
$336.55
extra you pay for Route A
Rate note: You quoted prime at 3.68%, but the prime rate today (Jun 2026) is 4.45%. Prime + 0.75% = 5.20% (the default above), which prices the payment at ~$2,054. Your $2,018.34 implies ~5.05% — slide the rate to 5.05% to match the lender's commitment exactly. The larger Route A payment isn't "lost" money: most of that extra $337 is principal you're building as equity, not interest.