Here to Help You Examining Your Alternatives

Registered Retirement Income Fund (RRIF) and Life Income Fund (LIF) are great alternative options providing income for life while keeping your registered savings in a tax-deferred investment.

RRIF vs. LIF | Calla Financial Services


Registered Retirement Income Fund (RRIF)

A registered retirement income fund is simply a retirement plan designed to provide you with a stream of annual, semi-annual, quarterly, or monthly income from funds accumulated from your RRSP.

There are some requirements for RRIF. For example, you must withdraw a minimum percentage of your balance each year, with the percentage determined at the start of each calendar year. As well, the minimum withdrawal amount can be based on your current age or your spouse's age.

Taxes will be withheld at source if you receive your RRIF payments in scheduled installments. You can also request additional taxes to be withheld from your payments.

Your RRIF will have the following flexibility and benefit:

Life Income Fund (LIF)

Life Income Fund (LIF) is very similar to RRIF. These sorts of funds derive from the tax-deferred proceeds of a registered pension plan. If you participated in a pension plan at work, your funds are generally locked-in upon leaving your place of employment. You can withdraw between a minimum and maximum percentage of available assets each year. Your minimum and maximum withdrawal rates are based on your age and are determined at the beginning of each calendar year.

Whether you are interested in an RRIF or a LIF, the team at Calla Financial Services are experts within the realm of assisting clients who have locked-in pension plan assets. We will help you determine the level of risk you would like to include in your RRIF or LIF investment portfolio so that you have peace of mind that your investments are being allocated according to your level of comfort with a mindset of preserving your funds as much as possible.

• RRSP accounts must be converted to income by age 71.

• Tax-deferred growth within the RRIF.

• Flexible withdrawal options (no minimum amount) and frequencies.

• Ability to self-manage your RRIF investments.

• RRIF can be converted to a Life Annuity.

• RRSP accounts must be converted to income by age 71.

• Locking-in provisions follow funds if transferred to financial institutions.

• LIF is generally subject to continued pension jurisdiction legislation.

• Tax treatment of LIF income is similar to withholding taxes that apply within RRIF.

• LIF can be converted to a Life Annuity.

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