When an RRSP matures, the two main choices are a RRIF, which keeps the money invested, and a life annuity, which turns it into guaranteed income. Part of your savings can go to each. This page compares them; the annuity calculator estimates payments and the RRIF calculator shows minimum withdrawals. It is part of the retirement income hub.
An RRSP must mature by December 31 of the year you turn 71: by then you convert it to a RRIF, buy an annuity, or withdraw it as taxable income (or combine these).The core trade-off
| Life annuity | RRIF | |
|---|---|---|
| Income | Guaranteed for life | Depends on returns and withdrawals |
| Control of the money | Given up at purchase | Yours; invest and withdraw above the minimum as you choose |
| Longevity risk | Carried by the insurer | Carried by you |
| Inflation | Fixed unless you buy indexing, which lowers the starting payment | Investments can grow with inflation, but aren’t guaranteed to |
| At death | Payments stop, unless there is a guarantee period or a survivor benefit | The balance goes to your successor annuitant, beneficiary or estate |
| Changing your mind | Generally can’t be undone | Can change investments or withdrawals at any time |
RRIF minimum withdrawals
From the year after you open a RRIF, you must withdraw at least the year's minimum: the January 1 balance times a factor for your age at the start of the year (or your spouse's age, if you choose), which is 1 รท (90 โ age) up to 70 and CRA's prescribed factor from 71; you can always take more.| Age at the start of the year | Minimum | On $300,000 | On $500,000 |
|---|---|---|---|
| 72 | 5.40% | $16,200 | $27,000 |
| 75 | 5.82% | $17,460 | $29,100 |
| 80 | 6.82% | $20,460 | $34,100 |
| 85 | 8.51% | $25,530 | $42,550 |
| 90 | 11.92% | $35,760 | $59,600 |
The minimum is a share of the balance, so a RRIF that keeps earning can last a long time, but large withdrawals or poor returns early in retirement can run it down. A fall early on, while withdrawals continue, does the most lasting damage (sequence-of-returns risk).
Annuity types
An annuity can pay for life (with an optional guarantee period), for the lives of two people (joint and last survivor), for a fixed number of years (term-certain), or in amounts that rise each year (indexed). The annuity calculator describes each type and what it pays.
Payouts depend on your age, sex, interest rates, the features chosen and the insurer, so only a quote gives the exact amount. Higher long-term interest rates mean higher payouts.
Thinking of an annuity as insurance
A life annuity works like insurance against a long life: living longer than average is when it pays off most.
A hypothetical payout of $1,000 a month bought for $200,000 returns the purchase price in 16.7 years. Payments stop at death (unless there is a guarantee period), so someone who dies sooner receives less than they paid; someone who lives longer receives more, with no further investment risk.Which fits which situation
| An annuity tends to suit | A RRIF tends to suit |
|---|---|
| Little other guaranteed income beyond CPP and OAS | A defined benefit pension that already covers essential spending |
| A family history of long lives | A wish to leave money to heirs |
| Wanting income that doesn’t depend on markets or decisions | Wanting to vary withdrawals year to year for tax planning |
| Poorer health, where a shorter life makes an annuity worth less |
Using part of your savings to buy an annuity that, together with CPP and OAS, covers essential spending, and keeping the rest in a RRIF, combines a guaranteed floor with flexibility.
Buying an annuity
Life annuities are sold by life insurance companies, directly or through advisors and brokers, who can compare quotes from several insurers. Annuities from Assuris member companies are protected if the insurer fails (annuity calculator: if the insurer fails).
Related guides
Sources
The figures and rules on this page come from these sources, last checked against them between August 29, 2026 and September 29, 2026. How we check facts.
- Canada Revenue Agency: Chart โ Prescribed factors
- Canada Revenue Agency: RRSPs and Other Registered Plans for Retirement
- Canada Revenue Agency: How contributions affect your RRSP deduction limit
- Justice Laws (Canada): Income Tax Act