3 Ways to Melt Down Your RRIF: Tax-Saving Strategies You Can’t Ignore!

[@tonywright6793]

The simplest way to borrow for investing is to use margin. I know you have to be careful of margin calls but is there any fundamental reason why I shouldn't just use margin. The broker generates the required T slip for you

[@jimjackson4256]

You should be able to leave your money in your rrsp and withdraw money as you see fit rather than having minimum withdrawals in a rif. That would give people a margin of safety in their old age.

[@precedenceprivatewealth2872]

Hi Jim, You bring up a good point about RRSPs (Registered Retirement Savings Plans) and RRIFs (Registered Retirement Income Funds). The required minimum withdrawals in a RRIF can limit flexibility, particularly as people grow older and want more control over their retirement funds. Many find that retaining funds in an RRSP allows for greater adaptability. However, current regulations mandate RRSP-to-RRIF conversion by age 71, which does impose minimum withdrawals.

[@wayneandrews1022]

Borrowing to invest sounds like a great strategy if you have room in your TFSA in which to invest - can be handed down without tax/penalty, I believe, to your beneficiary.

[@precedenceprivatewealth2872]

You do not need contribution room inside your TFSA as the asset, or mortgage in this case, is inside your TFSA. Therefore, the borrowing to invest provides tax deductible interest which indirectly is earned inside your TFSA within this strategy. The payments, however, are funded from your RRSP withdrawals, which otherwise would be taxable, but are offset by the interest deductibility from the borrowing to invest :)

[@robertk5441]

This is a clear and concise explanation of 3 strategies to approach RRIF. Loved it. I just wonder why there are not too many likes and zero comments ? I think the second strategy is interesting, but it's a bit risky. I wish I was so courageous. Nevertheless, it's a valid strategy.