| Visit
Our Official Website : http://www.guaranteedinvestments.com
RRIF Canada Overview
 You
can consider your Registered Retirement Income Fund (RRIF) as
a continuation of your Registered Retirement Savings Plan (RRSP).
An RRSP is used to save for your coming retirement whereas an
RRIF is used to withdraw income during your retirement.
RRIFs are very similar to RRSPs in many ways. Each
allows for tax deferred growth, various investment options and
both are Government regulated.
RRSP vs. RRIF:
An RRSP is designed and structured for one’s working
years whereby individuals contribute money into these RRSPs in
order to save for retirement and get tax deductions on the amount
they put in, however, on the other hand, after the RRSP is switched
over to an RRIF, money that is withdrawn from the RRIF plan is
taxed in the hands of the RRSP owner – which is now RRIF.
More on RRIF in Canada – Explained!
A Registered Retirement Income Fund is known as
a RRIF. A RRIF is an account whereby funds are transferred from
a Registered Retirement Savings Plan (RRSP), a Registered Pension
Plan or possibly from another RRIF.
Once established, the financial institution makes payments to
you based on the value of your RRIF, your age and the market value
of the RRIF. There are no maximum amounts that can be withdrawn
from a RRIF as the funds withdrawn are taxable. However
there is a minimum amount that has to be withdrawn on a yearly
basis.
Setting up a RRIF can be done at any time, but must be done no
later than the year the annuitant turns 71. Unlike RRSPs, contributions
are not allowed into RRIFs.
It is important to note that investors have the
ability to have more than one RRIF. It is not mandatory to have
all one’s Registered Retirement Savings Plans (RRSPs) transferred
over to one specific RRIF plan.
RRIF GIC rates vary from institution to institution and will not
vary significantly.
In today’s economic and low interest rate environment, if one
selects only investments which are fixed income in nature, such
as GICs, one can expect lower than normal RRIF payments and the
possibility of running out of funds in the RRIF - Should withdrawals
exceed what the minimum requirements are.
RRIF rates of return will affect the RRIF payout rates in Canada.
Therefore, it is necessary to maximize returns when possible without
investing in products which are outside your risk tolerance level
and comfort horizon.
Products Eligible for RRIF Investments
in Canada
Individuals also need to fully understand the types
of products which are eligible for RRIF investment plans.
Investments such as GICs, Mutual Funds, Stocks, Bonds, Guaranteed
Investment Funds, Annuities and other types of investments are
eligible in most cases.
Most individuals who convert their funds to RRIFs are typically
around the age of 70, therefore the types of investments most
suitable in many cases are investments which provide security
and peace of mind with some form of capital protection and income
protection.
For investors looking for conservative investments
for RRIFs in Canada visit Guaranteedinvestments.com
|
