A retirement fund similar to an annuity contract that pays out income to a beneficiary or a number of beneficiaries. To fund their retirement, RRSP holders often roll over their RRSPs into an RRIF. RRIF payouts are considered a part of the beneficiary's normal income and are taxed as such by the Canadian Revenue Agency in the year that the beneficiary receives payouts. The organization or company that holds the RRIF is known as the carrier of the plan. Carriers can be insurance companies, banks or any kind of licensed financial intermediary. The Government of Canada is not the carrier for RRIFs; it merely registers them for tax purposes.
Investopedia Says:
The RRIF plan is designed to provide people with a constant income flow through retirement from the savings in their RRSPs. RRSPs must be rolled over by the time the contributor reaches age 69, but by converting an RRSP into an RRIF, people can keep their investments under a form of tax shelter, while still having the chance to allocate assets according to contributor specifications.
Related Links:
Learn how the Canadian government makes saving for your post-work years easy. We take you from your first contribution to your first withdrawal. Registered Retirement Savings Plans (RRSP)
Setting a target amount is the first step. We show you how to calculate your goal and how to reach it. Determining Your Post-Work Income
Learn some sensible strategies for making your hard-earned savings last for as long as you need them. Managing Income During Retirement
