Retirement Income Accounts

Is your RSP or pension plan maturing sometime soon? Are you celebrating your 71st birthday this year?

Investment choices, flexibility and continued earning power are important when managing your retirement income. Convert your RSP or pension funds to an RBC Direct Investing self-directed RIF, LIF, LRIF or PRIF account quickly and easily using the download and print forms in our Account Opening Centre.

The benefits of an RBC Direct Investing Self Directed Retirement Income Account

Choose the investments that best suit your retirement objectives. We offer among the widest selection of fixed income and mutual fund investment alternatives in Canada.

Introducing Dual Currency in Registered Accounts You can now hold or settle trades in U.S. and/or Canadian dollars in your RIF with Dual Currency in Registered Accounts. What this means is when you are trading in U.S. securities, and you choose to settle in U.S. dollars, you can avoid the cost of foreign exchange conversions from and to Canadian dollars. The option to hold U.S. dollars and settle trades in U.S. dollars will be automatically available in all new and existing RIFs. Find out more

There is NO annual administration fee for a RBC Direct Investing retirement income account if you maintain a balance of $25,000 or more. If your balance is less than $25,000, you pay a low annual administration fee. However as a client you'll pay only one annual administration fee, no matter how many RBC Direct Investing RSPs or RIFs are registered in your name.

Flexible Payment Options:

• Choose your payment frequency & dates: monthly, quarterly, semi-annually or annually at mid-month or month-end.
• Deposit funds to your RBC Direct Investing investment account, your RBC Royal Bank savings or chequing account, or to an account at another Canadian financial institution.

Flexible Withdrawal Amounts:

• Use your age or your spouse's age to set up smaller minimum payments so you can maximize tax deferral on the assets in your RBC Direct Investing Self-Directed RIF. (Not applicable to LIF/RLIF and PRIF).
• Choose to receive payments larger than the annual minimum amount. Pension legislation prescribes maximum annual withdrawal amounts for the LIF/RLIF and LRIF. There is no maximum withdrawal amount for the PRIF or RIF (withholding tax will apply).
• Withdraw a maximum of two lump sum payments in addition to your regular minimum payment, per year, with no withdrawal fee.
• Avoid large tax payments at year end, by having more than the minimum amount of tax withheld from each excess payment or choose to have taxes withheld from your minimum amount.

Converting your Registered Savings Plan to an income fund

RSP accounts must be closed in the year in which the planholder turns 71. Rather than declaring all of the funds previously held in your RSP as taxable income, an alternative is to transfer these funds into a Retirement Income Fund (RIF).

While holding a RIF you cannot make new tax-deductible contributions and you must withdraw a minimum amount each year commencing the year you establish the RIF. Minimum withdrawals are based on the market value of the fund as of December 31 of the previous year and the planholders age. There is no maximum limit for withdrawals from this plan. The benefit of converting an RSP into a RIF is that the income generated in the plan is tax sheltered, however, all withdrawals are taxable.

Prior to the first payment being received from a RIF, you may choose to use your spouses age (if your spouse is younger than you) rather than your own to determine the minimum payout amount. Once made, that choice is permanent.

Converting your pension plan to an income fund

A Life Income Fund (LIF) is an alternative to a life annuity for the money that you and your employer contributed to a pension plan on your behalf. You may have already transferred your pension funds to a Locked-in Retirement Account (LIRA). An LIF will turn your funds into flexible income until the end of the year you turn age 80 (except in Quebec, New Brunswick, Nova Scotia, Alberta, Saskatchewan, Manitoba, British Columbia, Ontario and Federal, where a LIF has no maximum age restriction), at which time you must purchase a life annuity. A LIF cannot be opened prior to the age that the planholder could receive normal pension benefits (usually 55) and client may choose between a minimum and maximum withdrawal each year.

A Locked-in Retirement Income Fund (LRIF) is available only if you have pension money that was contributed when you worked in Manitoba, Newfoundland and Labrador or Ontario. LRIFs are similar to LIFs, with the exception that funds do not have to be converted to a life annuity at age 80. This type of plan cannot be opened prior to the age that the client could receive normal pension benefits usually 55. Clients may choose between a minimum and maximum withdrawal each year.

A Prescribed RRIF (PRIF) is available for Saskatchewan and Manitoba pension plan members only. You can transfer money to a PRIF if your locked-in pension money originated with a pension plan subject to The Pension Benefits Act of Saskatchewan or Manitoba. The PRIF replaces the Life Income Fund (LIF) and Locked-in Retirement Income Fund (LRIF), providing you with greater financial flexibility upon retirement, including no maximum annual withdrawal. You are not required to convert to an annuity at age 80. (For Manitoba, only 50% may be transferred from a LIF or LRIF to a PRIF.)

Converting your RSP or pension fund

Set up an RBC Direct Investing Self-Directed RIF, LIF, RLIF, LRIF or PRIF account quickly and easily using the download and print forms in our Account Opening Centre.

Open an account

Make the right move and start enjoying the speed, security and reliability of RBC Direct Investing.