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Life Income Fund

A Life Income Fund (LIF) is a retirement income plan using locked-in pension money and the owner of the LIF can control the investments held within the fund. In addition to the requirement for a minimum annual withdrawal (like a RRIF), LIFs also set a maximum withdrawal amount.

Your annual withdrawal must be within these minimum and maximum amounts as specified by legislation. In most provinces, when the LIF holder reaches age 80, the LIF must be converted into a life annuity.

The easiest way to think of a LIF is that it's a RRIF for your locked-in pension money, with a few more restrictions designed to ensure that you have income available for your lifetime.

LIFs vary slightly from province to province, and are not available in P.E.I. and the Northwest Territories. Most provinces require you to have reached age 55 before you establish a LIF, but there is no age restriction in New Brunswick, Quebec, and Alberta.

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