Should I open a RRIF at age 55?
Question: I am 55 and am unemployed with not many prospects. My adviser suggests that I place my RRSPs (approximately $100,000) in GICs into a RRIF plan in order to have a monthly income. I have mutual funds and some bonds. Would I be better off with another plan — perhaps a withdrawal plan from my mutual funds? – W.D.R.
The main problem with converting RRSP assets to a RRIF at your age is that there is no mechanism for reversing the decision later. If circumstances should change and you get another job, you’d still have to withdraw income from the RRIF. That would increase your tax burden and deplete the RRIF’s capital.