The Zoomer Report: RRSP New Rules

Many Zoomers will now have greater freedom to move their retirement investments and use the money when they want, for what they want. Changes promised in the last federal budget have just taken effect.

Under the new rules, people over 55 and all Canadians facing hardships will be allowed to withdraw up to $22,450 a year from their federally regulated pension savings accounts, including locked-in RRSPs.

If you’re over 55, you would also be able to wind up those accounts – up to that amount – or convert them to a tax-deferred savings account. It’s a little different if you have a Life Income Account. In that case, you could get a one-time only break allowing you to move half of the money into a tax-deferred savings account with no maximum limit.

The good news, when you convert from a locked-in to an unlocked savings vehicle, you won’t pay tax. But you will have to pay the taxman when you withdraw money from that account.

Libby ZnaimerLibby Znaimer, a prominent Canadian journalist specializing in business, politics, and lifestyle issues, is producer and host of The Zoomer Report, a special feature on topics of interest to baby boomers and the 50+. It covers everything from health and wealth to leisure and volunteerism, from the special vantage point of the generation that has changed society in its wake.

Ms. Znaimer is also Vice-President of News and Information for Classical 96.3FM and AM740. Her first book, “In Cancerland – Living Well Is The Best Revenge” – was published in October 2007 by Key Porter.

Are you a Zoomer? Click here to find out.

Classical 96.3FM logo