RRIF
What is an RRIF?
A Registered Retirement Income Fund (RRIF) is a Canadian retirement account that converts savings into regular income. It serves as an extension to the RRSP and provides flexibility in withdrawal amounts, with taxes applied to withdrawn funds.
Why open an RRIF?
Flexible Income
An RRIF allows you to customize withdrawals, offering flexibility to manage income according to personal financial needs and lifestyle preferences.
Tax Advantages
RRIFs offer tax-deferred growth on investments. Taxes only apply upon withdrawal, and can be minimized through strategic withdrawals to meet your financial needs.
How does RRIF work?
An RRIF is a retirement income vehicle for retirees in Canada, converting their RRSP savings into regular income. You must convert your RRSP into RRIF in the year you turn 71. RRIFs offer the benefit of continued tax-deferred growth on investments, with income only taxed upon withdrawal.
There is no minimum withdrawal amount in the first year of opening an RRIF, but there is a minumum set for each age bracket. There is no maximum either, but there are tax implications that one should consider.
Age at Start of Year | RRIF Minimum Payout Percentage |
|---|---|
65 | 4.00% |
66 | 4.17% |
67 | 4.35% |
68 | 4.55% |
69 | 4.76% |
70 | 5.00% |
71 | 5.28% |
72 | 5.40% |
73 | 5.53% |
74 | 5.67% |
75 | 5.82% |
76 | 5.98% |
77 | 6.17% |
78 | 6.36% |
79 | 6.58% |
80 | 6.82% |
81 | 7.08% |
82 | 7.38% |
83 | 7.71% |
84 | 8.08% |
85 | 8.51% |
86 | 8.99% |
87 | 9.55% |
88 | 10.21% |
89 | 10.99% |
90 | 11.92% |
91 | 13.06% |
92 | 14.49% |
93 | 16.34% |
94 | 18.79% |
95+ | 20.00% |
Who can open one?
You can open an RRIF as early as 55 years of age.
However, you must convert your RRSP into and RRIF at age 71.
Tax Treatment
Tax-Free?
Tax-Deductible?
Tax-Deferred?
Numbers to Know
If you have multiple RRSPs, you can combine all of them into one, easy-to-manage RRIF.
Note: that there are several types of RRSP accounts that you can open. This includes self-directed and spousal accounts. Contact us to see what works best for you!
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