Withdrawal calculator: estimate your RRIF minimum withdrawals at age 71

As retirement age approaches, people start hearing about a Registered Retirement Income Fund (RRIF) as a source of income. A RRIF is a mandatory annual withdrawal vehicle, calculated using a percentage that increases with age. To help you out with this, the Fonds de solidarité FTQ has developed a calculator that will give you a good idea of the minimum amounts that will need to be withdrawn depending on your situation.

What exactly is a RRIF?

It's is the continuation of the Registered Retirement Savings Plan (RRSP) that helped you, during your working life, put aside money while letting you deduct the amounts invested from your taxable income, helping those savings grow sheltered from tax.

Even if you don't need these funds, you are obligated to wind up your RRSP in its entirety or convert it to a RRIF by December 31 of the year you turn 71. Once in a RRIF, your money can continue generating returns using the investment vehicles of your choice. You still have to make annual minimum withdrawals until the funds are emptied out, and this needs to start the year after you open your RRIF. Depending on your situation, you can convert you RRSP to a RRIF at any time, no matter your age. Because it all depends on your particular situation, your group savings representative can help you make a withdrawal plan suited to your needs.

Calculate your RRIF approximate minimum withdrawals

Everyone is equal as far as a RRIF is concerned. As a function of your age, the law determines a minimum percentage withdrawal which increases progressively every year. You can choose between annual or monthly withdrawals according to your preferences.

Likewise, if you have a spouse, you can make the calculations using their age if that proves to be advantageous for you.

To determine which amount to use to do the calculation, simply take the value of your assets in your RRIF on December 31 of the year prior to your retirement, as well as the percentage associated with your age.

For example, if you are 71, the minimum withdrawal percentage is 5.28%. At age 75, it’s 5.82%, then 5.98% at age 76. The annual withdrawal amount, however, will tend to decrease from year to year, even if the percentage goes up, because of the effect your withdrawals have on your total savings. Note that variation in the amount to be withdrawn can also be affected by potential investment returns. With the calculator below, an estimated annual return of 3% is used to calculate the results. Finally, keep in mind that the ages indicated correspond to your age on December 31 of your year of retirement.

Use our calculator to better plan your retirement income and compare different scenarios.

Understanding your results

Will the minimum withdrawal from your RRIF be enough to maintain your lifestyle? In general, at retirement, you will need 70% of your gross annual income while you were employed. Normally, the further along you are in retirement, the lower this percentage will get as your expenses decrease. At the start of retirement, some expenses, like those for transport and work, can decrease, while those related to your sports and social activities, for example, might get higher. That said, even if the minimum withdrawal from your RRIF becomes your principal source of income, it's possible it won't be enough to provide for a comfortable retirement, especially since you may have to pay tax on it. In any case, take the time to add this amount to your other sources of retirement income.

When the minimum is enough

If you see that you're able to maintain your lifestyle with minimum withdrawals from your RRIF, or better yet, if your monthly income is more than you need to live on, one of the options available to you is to transfer the extra into a Tax Free Savings Account (TFSA). That way your money can continue to grow sheltered from tax.

When the minimum isn't enough

If, on the other hand, your retirement income is just enough or not enough to cover your needs, there are a number of measures that have been put into place to assist you financially. For instance, excluding the Old Age Security, if your personal income is less than $21,624 in 2024, the federal government will grant you the Guaranteed Income Supplement. This amount will vary depending on your tax bracket and marital status. There are also various tax credits to help retired persons with low or modest incomes. For example, on the federal level, there's the Pension Income Amount, and provincially, the Amount for Retirement Income. There's also the Age Amount available from both levels of government. Finally, don't forget that you can always withdraw amounts from your RRIF greater than the minimum amount determined by the percentage required by law. It's a good idea to follow a plan that suits your particular situation you can draft with help from your financial planner.

 
When the time comes, transferring your RRSP into a RRIF is a way of ensuring you have retirement income. By working out a personalized withdrawal plan that fits your needs with a financial planner, you'll improve your odds of having the retirement you've always hoped for.

The FlexiFonds offering: retirement savings solutions

Are you looking to maximize or consolidate your retirement savings? The Fonds de solidarité FTQ has launched the FlexiFonds offering to meet your needs and support you throughout your retirement. Better yet, with these new products, you can continue to support Québec's economy! The FlexiFonds offering is the logical extension of your Fonds experience.

LEARN MORE ABOUT THE FLEXIFONDS OFFERING 

About FlexiFonds de solidarité FTQ
FlexiFonds de solidarité FTQ Inc. is a wholly-owned subsidiary of the Fonds de solidarité FTQ. FlexiFonds de solidarité FTQ Inc. acts as the principal distributor of the funds' units and is a mutual fund dealer registered with the Autorité des marchés financiers.