Politics · Canada · 15 hrs ago
Canada’s proposed lifetime RRSP would keep mandatory withdrawals
Canada’s 2026 federal budget proposes a lifetime RRSP, removing the requirement to convert it to a Registered Retirement Income Fund at age 71.
The proposal would also let account holders name a spouse or partner as a successor holder, but mandatory annual withdrawals would remain.
Under current rules, RRIF holders must withdraw a minimum share of their savings each year, and that share rises with age.
The commentator argues that these withdrawals can drain savings needed for care in old age, when medical and personal support costs may be high.
He wants people to choose when to withdraw their money and to keep contributing to an RRSP after age 71.
The federal government is seeking public views on its proposals until January 8, 2027.
Canada’s 2026 budget proposes allowing Registered Retirement Savings Plans (RRSPs) to continue for life, removing the requirement to convert them to Registered Retirement Income Funds (RRIFs) at age 71.
The proposal would keep mandatory annual minimum withdrawals from the plans.
Gordon Pape argues that these withdrawals can drain savings that older people may need for care.
He also calls for people to be allowed to contribute to RRSPs after age 71.
The government’s consultation on the proposal is open until Jan. 8, 2027.
- Who
- The federal government is proposing the changes; financial writer Gordon Pape argues for further changes.
- What
- Ottawa proposes a lifetime RRSP that removes conversion to an RRIF at 71 but keeps mandatory annual withdrawals.
- When
- The proposal is in Budget 2026. The consultation period runs until Jan. 8, 2027.
- Where
- Canada.
- Why
- The proposal would eliminate the need to convert an RRSP to an RRIF at age 71. Pape says mandatory withdrawals can drain savings needed for later-life care.
Federal government
Gordon Pape
Mandatory withdrawals
Federal government
The government proposes retaining mandatory annual withdrawals from RRSPs.
Gordon Pape
Pape says minimum withdrawals should be eliminated so people can choose when to use the money.
RRSP contributions after age 71
Federal government
Not stated.
Gordon Pape
Pape says people should be allowed to keep contributing to RRSPs after age 71.
The federal government proposed an RRSP for life that would eliminate conversion to an RRIF at age 71 while retaining mandatory withdrawals.
The government’s consultation period is scheduled to end.
- RRSP conversion age
- 71
- RRIF withdrawal at age 71
- Minimum of 5.26 per cent of the plan’s value on Jan. 1
- RRIF withdrawal at age 90
- Minimum of 11.92 per cent
- RRIF withdrawal at age 95 and older
- 20 per cent
- Consultation deadline
- Jan. 8, 2027
What people are saying
Let people use their RRSP/RRIF money when they choose, not when the government says they must.