DCHP-3

Registered Retirement Income Fund

DCHP-2 (Feb 2013)

Spelling variants:
RRIF

n. — Finance, Administration

a tax-deferred retirement fund that is registered with the Canada Revenue Agency.

Type: 1. Origin — The Registered Retirement Income Fund was created by the federal government in 1978 (see the 1982 quotation). Individuals wishing to invest in an RRIF must transfer funds from other registered plans (typically RRSPs) into one or more RRIFs before the year they turn 71. A certain minimum amount must be paid out annually from an RRIF and payments are subject to income tax.

See also COD-2, which marks the term "Cdn".

Quotations

1978
The second will allow investment in a new vehicle, which is being labelled the registered retirement income fund.
1982
The RRIF, created in 1978 as the federal Government's response to the impact of inflation on annuities, provides an indexing formula. Payments are based on the number of years between the annuitant's current age and 90. Thus an annuitant aged 65 must take 1/25 of the fund in the first year.
1988
The Registered Retirement Income Fund is one of the RRSP options available to you. It is the most flexible RRSP payout option currently available. It is appropriate if you wish to keep payments increasing to offset inflation, defer taxes, or build an estate value.
1997
The freedom to transfer a maturing RRSP to a Registered Retirement Income Fund gives us an alternative to a life annuity. Retirees gained the right to manage their own investments and keep their capital growing using RRIFs.
2005
When you buy a life annuity, you no longer have control of your capital. The other principal option under the rules is to convert some or all of your savings into a registered retirement income fund, or RRIF.
2013
"Once you start an RRIF, it must pay out a minimum income every year based on your age and the value of the RRIF funds at the end of the previous year," Archer noted. "At age 65, the minimum RRIF withdrawal percentage is 4 per cent, rising incrementally each year to 7.38 per cent at age 71 and 20 per cent at age 94."
2016
When to create a RRIF An RRSP is required to be converted to a retirement income option such as a RRIF by December 31 of the year in which you turn 71. However, you do have the option to convert your RRSP to a RRIF at anytime before then.

References

  • COD-2