As your question is unique to your situation, we recommend speaking to a registered financial advisor or tax professional. In terms of Registered Retirement Savings Plan (RRSPs) and Registered Retirement Income Fund (RRIFs), here is some information that may help:
- A RRIF can be opened at any time, but no later than the end of the year you turn 71.
- You do not pay tax on the money in your RRIF, as long as it stays in the plan.
- You pay tax on the money you withdraw from your RRIF. You have to start withdrawing money from your RRIF in the year after you open it.
- Typically you open a RRIF by transferring money from an RRSP. Transfers from other registered plans such as pension plans and deferred profit sharing plans (DPSPs) are allowed under certain circumstances.
- An RRSP is typically used to save money for retirement and has tax advantages.
- You pay a withholding tax on the amount you take out of your RRSP
- You must close your RRSP in the year you turn 71.