25% Pension Unlocking Reminder
Hi All ;
I am just reminding everyone who is going to be transferring the 25% out of their locked in fund into a RRIF or RRSP.
If You draw a income from your locked in fund during the year . Make sure that you transfer your yearly allowed income out of your locked in fund and put it aside in a account so that you can use it for income through out the year.
Do this((( BEFORE))) You transfer into a new LIF fund in order to draw your 25%.
If you do not do this you will not be able to draw from the NEW LIF until the next calendar year and would then have to withdraw from your 25% instead.
DO NOT just leave this up to your financial institution as we have found the advisers are not always fully informed of change..
Also Remember once you have transferred into a new LIF (((( You have only 60 days to make your 25% withdrawal . After that you have lost the opportunity. ))))
There have been new rules added to the FSCO web site since the New Year.To check them out go here.
Q: Is the maximum annual income payment amount in the first year of a New LIF calculated based on the original amount transferred into the New LIF, or is it calculated using the adjusted amount after a 25% unlocking withdrawal has been made?
For example, a New LIF is purchased with $100,000 deposited into it from a LIRA on the date of purchase. Fifty days later, the owner withdraws 25%, which leaves $75,000 in the New LIF. Is the first year maximum annual income payment amount based on $100,000 or $75,000?
A: The maximum annual income payment for the first year is based on the balance of the New LIF at the start of the New LIF’s fiscal year, regardless of any amount subsequently withdrawn. In this example, the maximum would be based on $100,000.
(((((((Note, however, that if the money deposited into the New LIF came from an Old LIF, LRIF or another New LIF, the maximum annual income payment amount for the New LIF for that fiscal year would be zero.)))))))
WE are still going after 100% unlocking in Ontario as Saskatchewan did for their citizens in 2002.
If you are outraged how the Ontario government restricts the Retire's from (((Their Own Pension Money.))
((( This is Not Government Money.))) Please write to your Premier , Finance Minister , Minister Responsible for Seniors , And Your MPP and tell them you want these pensions unlocked 100%.
You All Take Care Bill Costello
