How to model selling house and buying condo (one year later)
Hello.
I have questions related to a) modelling selling house/buying condo one year later, and b) tax smoothing.
Here is the link: https://public.adviice.com/dashboard/72h-a3soHvUOolRk
We are a couple aged 63 (M) and 55 (F). My husband has a government pension, indexed to inflation. Since my husband is 8 years older than me, we have modelled a scenario where he dies at 85 and I live to 95 with a reduced (75%) pension.
We plan to sell our house in 2027 (my age 56) and I want to model buying a condo in 2028 (my age 57). The cost of the condo may be slightly higher (~$200k in today's dollars) than what we will get from the sale of house. I want to model selling the house for $1.4M, and buying a $1.5M condo (plus there is about $120,000 lost due to real estate fees and land transfer tax). The money from the sale of the house will be in cashable GICs for the one year. We have that extra money to pay for the higher condo price currently in "cash" (GIC's) so there will be low taxes to pay (i.e. not capital gains) to access this money. The model doesn't seem as though I have modelled this properly, or possibly I don't understand what the surplus and shortfall are referring to.
I would also appreciate any input on tax smoothing throughout as it seems to vary from 13% to 22%, with one year spiking (due to sale of cottage).
Other notes:
*I have the "sale" of a cottage in here at age 77, which would actually be gifted to our child, which is why we have payment of realized capital gains tax and net worth dropping at that time.