Registered Retirement Income Fund (RRIF)

A Registered Retirement Income Fund (RRIF) lets you convert your Registered Retirement Savings Plan (RRSP) and certain supplemental pension plans into retirement income.

A RRIF is like an RRSP "extender." Your savings continue to grow tax-free, but withdrawals are taxable.

Advantages

  • Manage your own investments during your retirement
  • Choose the amount and frequency of your withdrawals
  • Take advantage of tax-free growth

RRIF-eligible savings products

RRIF alternatives

  • Don't want to transfer your RRSP savings to a RRIF? Why not consider a life annuity or a term certain annuity?
  • Another option is to cash out your RRSP savings, but if you do, you'll be fully taxed on this withdrawal.

 

FAQ

How does a RRIF work?

You have to withdraw a minimum amount each year starting the year after you transfer your investments into the RRIF. The minimum amount is calculated by the Canada Revenue Agency (CRA) based on your age and the value of your RRIF.

You can choose how often and how much you want to withdraw from your RRIF as long as you withdraw the required minimum each year.

The only way to contribute to a RRIF is by transferring investments directly from:

Investing rules for RRIFs are generally the same as for RRSPs.

When do I have to transfer my RRSP to a RRIF?

If you have RRSP savings, you have to transfer them to a RRIF before the end of the calendar year you turn 71. You're also free to set up a RRIF any time before then if you'd like to.

Do I have to convert my RRSP to a RRIF the year I turn 71?

RRIFs aren't your only option. You can also buy a life annuity or a term certain annuity payable to age 90. Another option is to cash out your RRSP savings, but if you do, you'll be fully taxed on this withdrawal.

How do I contribute to a RRIF?

You can have assets transferred directly to your RRIF from:

Investing rules for RRIFs are generally the same as for RRSPs.

When can I start making withdrawals from my RRIF?

There's no minimum age for setting up a RRIF. You can open one as soon as you want to receive retirement income. You do, however, have to set up a RRIF by the end of the year you turn 71 and start making withdrawals the following year.

Is any retirement income I draw from my RRIF taxable?

You must include any amounts drawn from your RRIF when calculating your income for tax purposes for the year of the withdrawal. Depending on your overall situation, you may have to pay tax on this income.

How do I determine my withdrawal amount?

You can choose how much you want to withdraw and make changes to this amount as long as you withdraw the minimum amount required by law each year.

The minimum withdrawal amount changes every year. It's calculated using a formula established by the Canada Revenue Agency (CRA). The formula is based on your age or your spouse's age and the total value of the RRIF at the beginning of the year.

As far as the law is concerned, you can withdraw as much as you like from your RRIF. Keep in mind that the more you withdraw, the faster your RRIF savings will be used up.

Can I use my spouse's date of birth for my RRIF?

Yes. We generally recommend using the younger spouse's age. You get more flexibility this way because the required minimum withdrawal is lower.

The minimum withdrawal is more than I need. What can I do?

Whether you need it or not, you have to withdraw the required minimum amount from your RRIF. However, nothing's stopping you from saving outside your RRIF once you've made the mandatory withdrawals.

You can invest the excess portion of your post-tax withdrawal in a TFSA (Tax-Free Savings Account) up to your contribution limit. Investment income earned in your TFSA is tax-free, and so are withdrawals. Plus, there's no age limit for contributing.

TFSA withdrawals also don't affect income-tested benefits or credits like the Age Credit, Old Age Security benefits or the Guaranteed Income Supplement.

What happens to my RRIF if there's still money when I die?

The value of all the assets in your RRIF on the date of your death becomes taxable income unless all or a portion of the value has been transferred to and included in the income of your legal or common-law spouse or any children or grandchildren who were financially dependent on you at the time of your death. The money from your RRIF can be transferred directly or indirectly to their RRSP or RRIF, or they can use it to buy an annuity. If your RRIF is transferred to other heirs, different rules apply.

To find out more, check out the Canada Revenue Agency (CRA) website.

I've got a Helios2 Contract with a Guaranteed Lifetime Withdrawal Benefit (GLWB) in a RRIF. What happens if the required minimum withdrawals for my RRIF are more than the GLWB Maximum Amount?

The difference between the required minimum RRIF withdrawal and your Helios Contract GLWB Maximum Amount won't be treated as an excess withdrawal. You won't be penalized. The GLWB Maximum Amount will simply be increased so that it matches your minimum RRIF withdrawal for the year in question.