Registered Retirement Income Fund (RRIF)
Funds for your next adventure.
What is a RRIF?
During retirement, your RRSP can transform into a registered retirement income fund (RRIF) that gives you an income stream throughout retirement.
From RRSP to RRIF
Before Dec. 31 of the year that you turn 71, you must close your RRSP. Instead of cashing out and paying a huge tax bill, you can convert it into a RRIF and take annual withdrawals.
Annual withdrawal
Every year, you’re required to withdraw a minimum percentage of your RRIF based on your or your spouse’s age. The withdrawals are fully taxable, but withdrawal planning can help you reduce taxes.
Continue to invest
You can continue to invest and get tax-deferred growth in the RRIF. Consider updating your investment strategies to adjust to withdrawals and any life changes.
How a RRIF works.
Withdrawals from a RRIF are fully taxable. Working with a financial pro could save you taxes and headache. Here’s what to expect when you meet with us and what happens after.
Start the conversation
Ideally, you should reach out to us a few years before retirement. If you wait until you’re 71 to convert your RRSP into a RRIF, you might miss out on decisions that could save you money.
Explore your retirement income options
No matter if you’re on the beach or the slopes for retirement, you’ll still need to budget. We’ll help you to map out expenses and look at income options with your RRSP such, as RRIFs or annuities, and understand how these could affect taxes and government benefits.
Plan your RRIF withdrawal amounts
We’ll help plan withdrawals. Once you convert some or all your RRSP into a RRIF, every year you’ll have to withdraw at least the required minimum percentage based on age. This taxable income could change your tax bracket or eligibility for government benefits like the Guaranteed Income Supplement (GIS) and Old Age Security (OAS). Make it easy for yourself and talk to us about automated withdrawals.
Convert your RRSP to RRIF
All you need to do is fill in some forms with us. Your investments can be converted “in-kind,” which means they’ll stay invested as they were. You’ll also need to name a beneficiary again as you did with your RRSP.
Keep investing
RRIF investment income continues to be tax-deferred within the plan. When you were contributing to your RRSP, you were probably using long-term investment strategies. Now that you’re withdrawing from your savings, it’s good to use both short- and long-term investment strategies. Consider booking a portfolio review twice a year to stay on track.
Sit back and enjoy your retirement
After all that math, it’s time to enjoy. You can always adjust your withdrawal plan or occasionally take extra.
When to convert your RRSP into RRIF.
When you convert can affect your taxable income and government benefits like Old Age Security (OAS) and Guaranteed Income Supplement (GIS). Talk to our wealth management professionals or an accountant to work out your best RRIF withdrawal strategy.
Reasons to convert to a RRIF before age 71
- You don’t have pension income or other sources of income
- You want to delay starting CPP and OAS to avoid reductions
- You have a large RRSP and want to spread out withdrawals to lower your tax bracket throughout your retirement or to meet OAS, GIS, or other benefit thresholds when they start
Reasons to wait until age 71
- You have pension income
- You’re self-employed and want to draw dividends from your company
- You have other savings and want to keep your RRIF growth tax-deferred
Get a portfolio review.
You’re already thinking about your investments, why not get a second opinion?
Estate planning
Nobody likes to talk about it but it’s important. Protect your loved ones even after you pass.
Questions? We have answers.
Keep learning.
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