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I will be closing my LIRA and RRSP this year – do I need to exhaust my LIF before touching the RRIF?



Our response:

Rules regarding withdrawals from a Life Income Fund (LIF) and Registered Retirement Income Fund (RRIF) differ and are regulated separately.

LIFs are generally set up after closing a Locked-in Retirement Account (LIRA). These accounts are regulated by the Financial Services Commission of Ontario (FSCO). LIF’s have a prescribed minimum and maximum withdrawal. Read some frequently asked questions about LIFs on FSCO’s website.

RRIFs are generally set up after closing a Registered Retirement Savings Plan (RRSP). RRSP rules are set and enforced by the Canada Revenue Agency. A minimum amount must be withdrawn from a RRIF each year, however there is no maximum withdrawal. Learn more about making RRIF withdrawals.

We are not able to provide advice. Before you close your LIRA and RRSP, speak to a financial advisor to understand your options – for example, LIFs have an option of a one-time unlocking option. Some or a portion of the amount that may be unlocked can be transferred to another account, like a RRIF.

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