Retirement Planning

Converting Your RRSP After Age 71

By Ivon T Hughes
investment choices
Figure 1. Investment Choices

What choices do you have when converting your RRSP at age 71?

You have three main choices for converting your Registered Retirement Savings Plan (RRSP) into retirement income by the end of the year in which you turn age 71:

  1. Cash in your RRSPs, and face a potentially hefty tax bill.
  2. Convert your RRSP into a Registered Retirement Income Fund (RRIF).
  3. Buy an annuity.

If you have a locked-in RRSP and are a member or used to be a member of a company pension plan and want more control over your pension investments, consider a Life Income Fund (LIF) or a locked-in Retirement Income Fund (LRIF)

Registered Retirement Income Funds (RRIFs)

Think of a RRIF as an extension of your RRSP. Your plan remains intact, and your investments continue to grow tax-free. The only difference is you must withdraw a certain amount of income from it each year. The value of your RRIF and how long your income will last will depend on what kind of investments you choose, how those investments perform, as well as how much income you plan to withdraw each year.

For instance, you may want to invest some of your money in more conservative investments, such as Guaranteed Interest Options to protect your capital and guarantee a regular income, and the rest in growth-oriented investments so your nest egg continues to grow tax-free. This flexibility has made RRIFs one of the most popular retirement income choices.

Phil Barker

About the Author

Phil Barker

Phil Barker is a leading expert on life annuities in Canada. has different financial products and has been a recognized authority since 1972.

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