Registered Retirement Income Funds (RRIFs) turn your RRSP into your own personal pension plan. While you can convert your RRSP to a RRIF at any time, you must do so before December 31 of the year in which you turn 71.
Once converted to a RRIF, you are required to withdraw a prescribed minimum payment each year. Your annual minimum payment is based on your age on January 1 and is calculated as a percentage of your plan value at the beginning of each year.
At the time you convert to the RRIF, you have the option to use your spouse's age to calculate minimum payments. This can be useful if your spouse is younger and you wish to have a lower minimum withdrawal. Note that this can only be done at the time the RRIF is opened or at the latest, prior to the first payment being made.
There is no maximum annual withdrawal limit (unless you have a locked-in plan), but withdrawals over the minimum amount are subject to withholding tax.
To determine your minimum annual payment, use our online RRIF Payment Calculator. The calculator offers options to input a specific payment amount rather than the minimum, as well as adjustable timeframes.
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