Registered Retirement Income Fund (RRIF)

A Registered Retirement Income Fund (RRIF) is an RRSP in reverse. An RRSP is a savings plan that you contribute to, a RRIF is an income distribution plan that provides you with a payment.

Converting your retirement savings to a RRIF allows you to continue receiving similar tax benefits as you would with your RRSP. An RRSP can be rolled into a RRIF at anytime, but you are not required to do so until the end of year in which you turn 71.

BENEFITS

  • A constant stream of income during retirement

  • RRIF payments are similar to personal pension plan payments

  • Investments continue to grow on a tax-free basis within the plan

  • Income tax is deferred on the amount transferred until a withdrawal is made and you choose how the money within the RRIF is invested

 

ANNUAL WITHDRAWALS FROM A RRIF

You must withdraw a minimum amount from the RRIF each year after the RRIF is opened. The minimum is based on a set formula that takes into consideration your age or your spouse's age and the market value of the account on January 1 of the withdrawal year.

 

ROLLOVER BASICS

  • An RRSP can be rolled into a RRIF at any time, but you are not required to do so until the end of the year in which you turn 71; at which time the RRSP matures and must be converted to either a life annuity or a RRIF, or deregistered.

  • To convert an RRSP to a RRIF, a RRIF account needs to be set up first and then assets from the RRSP can be transferred over "in kind", without incurring dispositions.

  • A final RRSP contribution can be made until December 31 in the year that you turn 71.