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Registered Retirement Income Funds (RRIFs)

 Registered Retirement Income Funds

Convert your RRSPs into retirement income with RRIFs in Canada.

What are Registered Retirement Income Funds (RRIF)?

When there is an arrangement between you and a carrier be it an insurance company like us, a trust company or a bank, then it falls under the category of RRIF. It is a perfect way to turn your retirement savings into a stream of income once you're retired. You can transfer money from your RRSP or other retirement savings account into a RRIF and then the company managing the RRIF will make regular payments to you.

There are rules about how much you have to withdraw each year from your RRIF, and the money you receive is taxable. But any money that's still in your RRIF can continue to grow tax-free until you withdraw it. You can set up a RRIF account through a financial institution like a bank or an insurance company and you can choose to manage the investments yourself or have someone else manage them for you.

In Canada, you must convert your RRSPs into a RRIF by the end of the year in which you turn 71, but you can choose to do so earlier. After setting up a RRIF, no further contributions are allowed, although you can have multiple RRIFs. A minimum amount must be withdrawn each year, which increases with age, but there is no maximum withdrawal limit.

Different Options Available Within RRIF Structure in Canada

Though there are varied investment options, you have to pick the right one to hold when you set up a Registered Retirement Income Fund (RRIF) in Canada. Here are your options:

Guaranteed Interest RRIF

When you require a steady plus safe income, this is a good choice of RRIF with not much risk. You can invest in GICs and Canada Savings Bonds which pay you fixed rates of interest over a particular term.

Mutual Fund RRIF

Here you can choose from a variety of mutual funds that range from conservative to aggressive. It’s a good choice if you’re looking for higher returns and are comfortable taking on more risk.

Segregated Fund RRIF

Similar to mutual fund RRIF, but with insurance protection for your investment. It’s a good choice if you want to grow your savings faster than with GICs but don’t want to take on as much risk as with mutual funds.

Self-directed RRIF

With this type of RRIF, you can hold many different investments such as GICs, mutual funds, ETFs, segregated funds, stocks and bonds. It’s a good choice if you want a wider range of investment choices and feel comfortable making all the investment decisions yourself.

Fully Managed RRIF

This type of RRIF is a good choice if you have a lot of retirement savings or a complex financial situation. A professional money manager from our team of experts will help you create and manage a custom portfolio to fit your financial goals and situation.

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Reasons Why You Should Open an RRIF

If you're planning for your retirement, opening a RRIF could be a great option for you. Rather than converting your RRSP to an annuity or withdrawing money which would be taxable income, an RRIF can provide you with many benefits as follows:

Tax-Free Growth

Tax-Free Growth

When you convert your RRSP to a RRIF, you won't pay any tax on the investment earnings. As long as your money stays in the RRIF, it will continue to grow tax-free. Tax is only applicable on the amount of money you withdraw from your RRIF.

Flexible Withdrawal Options

Flexible Withdrawal Options

Although there is a minimum amount you have to take out every year, you have the flexibility to choose how much and how often you want to withdraw from your RRIF. You can also make lump-sum withdrawals if you need extra cash.

Spousal Age Calculation

Spousal Age Calculation

If your spouse is younger than you, you can use their age to calculate the minimum amount you have to withdraw every year. This could lower the minimum amount and the income tax you pay on withdrawals.

Tax-Free Inheritance

Tax-Free Inheritance

If you name your spouse as your beneficiary or "successor annuitant", they can inherit your RRIF tax-free without it being included in your final income tax return. When calculating probate fees, the worth of your RRIF will not be taken into account as it is not considered a part of your estate.


Different Options Available Within RRIF Structure in Canada

Save your tax

RRIFs offer significant tax advantages by allowing your retirement savings to grow on a tax-deferred basis. This means you can maximize the growth potential of your investments while deferring tax payments until withdrawals are made. This tax efficiency helps to preserve and grow your retirement funds.

Flexibility and Control

RRIFs provide flexibility in determining the amount and frequency of your withdrawals. You have the control to customize your retirement income according to your financial needs and lifestyle. This flexibility ensures that you can adapt your withdrawal strategy based on changing circumstances or unexpected expenses.

Regular Income Stream

By converting your retirement savings into a RRIF, you establish a regular income stream during your retirement years. The minimum withdrawal requirements, based on your age, ensure a steady and reliable source of income to support your lifestyle needs.

Investment Options

RRIFs offer a wide range of investment options, allowing you to select investments that align with your risk tolerance and financial goals. Whether you prefer conservative or more aggressive investments, you have the freedom to diversify your portfolio and potentially achieve higher returns.

Estate Planning Benefits

RRIFs enable efficient estate planning by allowing you to designate beneficiaries who will receive the remaining funds upon your passing. This provides peace of mind, knowing that your loved ones will benefit from your retirement savings while potentially minimizing tax consequences.

Potential for Growth

Within a RRIF, your investments have the potential to grow over time, which can help offset the impact of inflation and ensure your retirement income keeps pace with rising expenses. Carefully chosen investments can generate consistent returns and contribute to long-term financial security.

Government Grants and Benefits

RRIFs may also allow you to continue receiving government grants and benefits, such as the Guaranteed Income Supplement (GIS) and the Canada Pension Plan (CPP). This can provide additional income support during retirement.

Get Started

01 Step

Contact MyLegacy Insurance Services

You can contact MyLegacy Insurance Services either by phone, email or by visiting our website. Our customer service representatives will guide you through the process of opening an RRIF and answer any questions you may have.

02 Step

Provide Necessary Information

To open an RRIF with MyLegacy Insurance Services, you will need to provide some personal information such as your name, address, social insurance number and date of birth. You will also need to provide information about the amount of money you plan to invest in the RRIF.

03 Step

Choose the Type of RRIF

MyLegacy Insurance Services offers different types of RRIFs, including segregated fund RRIFs and portfolio RRIFs. You will need to choose the type of RRIF that best suits your needs and investment goals.

04 Step

Apply for RRIF

Once you have provided all the necessary information and selected the type of RRIF, MyLegacy Insurance Services will assist you to apply. After applying, you can fund the RRIF and start enjoying the benefits of tax-free investment growth and flexible withdrawal options.


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