When it comes to withdrawing money from a Life Income Fund (LIF) the government sets a minimum and maximum amount you can take out of your account each year. The minimum annual withdrawal rates for a LIF account are the same as the rates set for RRIF accounts, but the maximum annual withdrawal rates are based upon a formula that uses the government’s assumptions for long-term interest rates.
The minimum and maximum annual withdrawal rates are calculated using your age and the market value of your LIF account.
To learn more about LIFs visit our Classroom – Life Income Fund Accounts.
Value of your Life Income Fund:
This is where you enter the market value for your LIF account as at January 1st of this year.
Your age on January 1st:
Enter the age, in years, that you were on January 1st of this year.
Required Minimum Withdrawal:
This is the minimum dollar amount you must withdraw from your account this year.
Minimum Withdrawal Rate:
This is simply the minimum amount you must withdraw this year expressed as a percentage of your LIF account’s market value.
Maximum Allowable Withdrawal:
This is the maximum dollar amount you can withdraw from your account this year.
Maximum Withdrawal Rate:
This is simply the maximum amount you can withdraw this year expressed as a percentage of your LIF account’s market value.