episode: 64

Important RRIF Options to Consider for Retirement Planning

November 15, 2022

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What is a RRIF and How Does it Work

For many Canadians, the RRSP (Registered Retirement Savings Plan) is the primary driver of their retirement savings.

An RRSP allows you to contribute a percentage of your income each year which, unlike non-registered accounts, can grow in that account while deferring taxes until you withdraw. Later, when you stop working or reach age 71, you convert your RRSP to a RRIF (Registered Retirement Income Fund) and flip the switch from contributions to withdrawals.

A RRIF is a federally registered account that provides you with a steady stream of income that you can continue to draw on during retirement. It is essentially a continuation of your RRSP and functions in much the same way, however, you can only make withdrawals and can no longer make deposits with a RRIF.

In this episode, Marcelo and Lawrence talk about the main benefits of RRSPs and RRIFs, what you need to know about converting your RRSP to a RRIF, cash flow and tax considerations when drawing down from a RRIF in retirement, estate considerations for your RRIF, and so much more.

RRSPs vs RRIFs and RRIF withdrawal rules

  • Understanding your RRSP (2:16)
  • Three main benefits of an RRSP (3:23)
  • The relationship between an RRSP and a RRIF (4:46)
  • Differentiating between an RRSP and a RRIF;  LIRAs and LIFs (6:41)
  • What you need to know about RRIF withdrawal rules (8:08)
  • Cash flow considerations for your RRIF payments (10:24)
  • Reducing your tax obligation by basing your minimum RRIF payment on your younger spouse’s age (12:51)
  • Applying withholding tax to RRIF payments for better cash flow management (14:23)
  • Critical factors to think about when planning how to convert your RRIF (16:46)
  • The significant impact that strategic planning can have on your estate value (18:02)
  • How you can optimize your RRIF strategy if you’re still working at age 71 (23:56)
  • Why you should designate a beneficiary in your RRIF (25:54)
  • Final thoughts and key takeaways (27:09)
  • And much more!

Meet your hosts

Keith Matthews

Keith Matthews

Partner & Portfolio Manager

Marcelo Taboada

Marcelo Taboada

Associate Portfolio Manager

Lawrence Greenberg

Lawrence Greenberg

Associate Portfolio Manager

Thanks for Listening!

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