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Time to Close your RRSP?. Your options. Annuity Registered Retirement Income Fund (RRIF) Life Income Fund (LIF), Locked-in Retirement Income Fund (LRIF) and Prescribed Retirement Income Fund (PRIF) Cash. Annuity. Oldest and most well-known Invest at any time Won’t outlive your savings - PowerPoint PPT Presentation
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Time to Close your RRSP?
Your options
Annuity
Registered Retirement Income Fund (RRIF)
Life Income Fund (LIF), Locked-in Retirement Income Fund (LRIF) and Prescribed Retirement Income Fund (PRIF)
Cash
Annuity
Oldest and most well-known
Invest at any time
Won’t outlive your savings
Spouse continues to receive payments or lump sum
Registered Retirement Income Fund (RRIF)
Capital continues to grow tax-deferred
Flexible investment options
Wide range of payment options
Ability to make changes
Convert a spousal RRSP to a spousal RRIF
LIF, LRIF & PRIF
Choose your investments
Withdrawals taxed in year received
Minimum annual withdrawal
LIF and LRIF have a maximum annual withdrawal
Cash
Give up tax-deferred growth RRSPs offer
Declare cash as income in year received Taxed at marginal
tax rate
Making RRSPs work for you
Unused contribution room
Make a lump-sum contribution before closing RRSP
Tax deductions can be used at any time
Final December over contribution
No carry-forward contribution room
Have current-year income
Penalty is 1% per month on any amounts over $2,000
After-tax benefit outweighs the penalty
Convert RRSP into a RRIF at age 71
Convert it back into an RRSP
Need to close RRSP by the end of the year you turn 71
Devise a plan
Important notes
The commentary in this presentation is for general information only and should not be considered investment or tax service to any party. Individuals should seek the advice of professionals to ensure that any action taken with respect to this information is appropriate to their specific situation.
Manulife Investments is the brand name identifying the personal wealth management lines of business offered by Manulife Financial and its subsidiaries in Canada. As one of Canada’s largest integrated financial services providers, Manulife Investments offers a variety of products and services including: segregated funds, mutual funds, principal protected notes, annuities and guaranteed interest contracts.
Manulife and the block design are registered service marks and trademarks of The Manufacturers Life Insurance Company and are used by it and its affiliates including Manulife Financial Corporation.