LIRAs | LIFs
Much like the relationship between a RRSP and a RIF, the relationship between a LIRA and a LIF are very similar. Both the RRSP and the LIRA are savings plans, while the RRIF and the LIF are retirement products that will generate income during your retirement.
What is a LIRA?
If you have an employer contributed pension plan and you leave the company, or are laid off, that registered pension plan will turn into a LIRA (Locked-in retirement account). A LIRA is a savings plan that must be converted, at the latest, by December 31st in the year you turn 71. You may choose to convert your LIRA into a LIF/LRIF or an annuity (a lifetime income guarantee).
What is a LIF/LRIF?
A LIF is a life income fund and it looks and acts very similar to that of an RRIF. The major difference is that while a RRIF only has an annual minimum withdrawal amount, the LIF has both a minimum withdrawal limit and a maximum limit.
See the schedule here for minimum/maximum withdrawal limits.
There are many different retirement income options to choose from before you retire. All have different eligibilities, requirements, contribution and withdrawal rules. Speak with a Financial Planning Representative today or book an appointment for all your retirement income specialty needs.
As of August 2014:
|Age as of Jan. 1st||Annual Minimum Withdrawal %||Annual Maximum Withdrawal %|