What if I could make your money in retirement last longer?

Dawn Luhning |

I have many clients who simply just take their minimum payment from their RRIFs. In the year a client turns 71, CRA legislates that the client must change all of his/her RRSPs into RRIFs. In the year the client turns 72, he/she has to take out a minimum payment yearly which is based on age and the value of your account. The withdrawal is a percentage of the account and it starts at about 5% each year.

Now, what if I told you that I could make your minimum payments last longer? With GIC rates being so low, and the withdrawal rate being at about 5% or more depending on your year of age, you run the risk of the investment running out on you before you pass away. This is an income that you might be counting on in your retirement. You could change your RRIF to an investment called a segregated fund with a guaranteed payment paid to you until the day you pass away. I do have clients who's minimum payment eventually runs out because the GIC they have invested in their RRIF doesn't return as much as they have to withdraw.

We can do a strategy like this up until the year the client turns 80 years old. So if you are 73 for example, and are currently taking your minimum payment out of your RRIFs across all institutions, you may want to discuss this option with me to keep your income going well past the life of the investment. I would be happy to show you how this concept works. If you have assets at other financial houses such as the bank, they are not able to provide you with this type of income stream from a segregated fund.

If you are interested in discussing this, please call the office or you can book online with me here to discuss.

Why have your money run out when it doesn't have to? Each situation is different and having a proposal created for your situation provides you with the options you need to make an informed decision.

I look forward to hearing from you to discuss!

~ Dawn