RRIF (Registered Retirement Income Fund)
Individuals who hold RRSPs, Spousal RRSPs and Group RRSPs are required by law to close these plans no later than the last day of the year in which they turn 71. Many individuals choose to transfer these RRSP assets to a RRIF or Spousal RRIF.
The RRIF pays out a prescribed mandatory minimum payment each year, but there is no maximum annual withdrawal limit. Withdrawals from a RRIF over the prescribed minimum amount are subject to withholding taxes imposed by Canada Revenue Agency (CRA).
A note on GRSPs (Group Retirement Savings Plans)
You may already hold units PH&N Funds or RBC Funds through your employer-sponsored Group RSP or other pension plan. In this case, you do not have an individual account with PH&N Investment Services. Upon leaving your employer, either at the age of retirement or before, you will have to decide what you would like to do with your pension assets. At that time, PH&N Investment Services will be pleased to advise you on the choices available to you and the regulations that will affect your choice.
Many investors find the transition from an RRSP to a RRIF somewhat confusing. We will be pleased to advise you on how RRIFs work, what regulations they are subject to, and what investment options you have within your RRIF account. Download our Retirement Income Funds Information Booklet.
For information on the succession options when making a choice of beneficiary designation, please read our RIF/LIF/LRIF Beneficiary Designation Comparison.
LIF (Life Income Fund) or LRIF (Locked-in Retirement Income Fund) Account
When you retire, or at the latest when you reach the age of 71, you may transfer assets from your LRSP, LIRA, GRSP (locked-in) or employer-sponsored pension plan to a LIF or LRIF, depending on the applicable provincial pension legislation.
The difference between the RRIF and the LIF/LRIF is that the RRIF is used for transferring individual RRSP assets and the LRIF/LIF is used for transferring GRSP or other employer sponsored pension assets. These assets may have been held in an LRSP or LIRA before being transferred.
The LIF is available in all jurisdictions (except in PEI). The LRIF is available for plans under the jurisdiction of Ontario, Manitoba, Saskatchewan and Newfoundland.
Both the LIF and the LRIF require a prescribed mandatory minimum income withdrawal and an optional maximum income withdrawal each year. Conversion to an annuity is not mandatory for an LRIF.
However, for the LIF in New Brunswick, at the age of 90, you must transfer the remaining assets in the plan to an annuity. For the Federal LIF, and the LIF in BC, QC, NS, MB, and AB, an annuitant can hold a LIF for their lifetime and is no longer required to convert the LIF to an annuity at age 80.
You retain control over how your LRIF/LIF is invested, subject to specific restrictions under the Income Tax Act.