Can I unlock my locked-in RRSP (LIRA)?

Posted in RRSP, RRIF, Investments

Ideally you will leave your locked-in RRSP (LIRA) untouched until retirement, but what if you require the funds now?

There are a few cases when the government will allow you to access the funds in your locked in RRSP (LIRA):

Financial Hardship – This is the most common situation where an individual may request the unlocking of a locked-in RRSP. In this case, an individual must detail their unique financial situation to the government. If approved, they will allow you access to the locked-in RRSP (LIRA) funds.

Special Access Situations – The most common special access situations for unlocking an RRSP (LIRA) are:

  • Life expectancy is 2 years or less;
  • You are a non-resident that has left the country for at least 24 months; and
  • Amounts transferred into your LIRA exceed federal limits.

These rules differ by province.

If your financial hardship submission is not approved and the special access situations do not apply then there is another option.

Many individuals do not realize this but you can convert your LIRA to a LIF as early as age 55. This will allow you to access an annual payment, however, there is an annual ‘maximum’ payment that limits your withdrawal each year.

RRSPs can also be converted into RRIFs at age 55.

Contact us today to discuss the optimal LIRA/LIF and RRSP/RRIF strategy for your needs.