With a RRIF, retirement income is taken from funds accumulated in a Registered Retirement Savings Plan (RRSP). There is a government defined minimum income that must be paid out of the RRIF each year, but no maximum.
Click here for Minimums and Withholding Taxes.
With an Annuity, you receive a guaranteed fixed amount for life. The payments are normally for a guaranteed number of years as well as your lifetime and the lifetime of your spouse, if any.
An advantage of a RRIF is that you can change the income payments from minimum to any amount you wish. Also you can withdraw lump sums to meet unexpected financial needs. You retain control and you normally have two main choices for investment: a fixed interest rate or segregated or mutual funds.
Which one do I choose?
Your choice of a RRIF or a life annuity will partly depend on how your financial needs are met by other sources. You might choose a RRIF to enjoy the flexibility it provides.
However, you may want to buy an annuity if you want absolutely no headaches and want the highest possible income with no stock market risks.
For more information on RRIFs or Annuities please complete either our RRIF Form or our Annuity Quote form.