TFSA vs RRSP: How to decide between the two + MORE Mar 29th

I have a segregated fund (I think that is what it is called) with an insurance company that needs to be converted into a RRIF (I’m turning 71 this year). Can I convert it into a self-directed RRIF or am I required to convert to a managed RRIF?—Leslie

How do segregated funds work?

Segregated funds are like mutual funds: they are both investment products that include several underlying investments, which provides diversification. Unlike mutual funds, however, segregated funds have other features that I think you should consider, Leslie.

Segregated (seg) funds generally guarantee your principal (premiums paid), both after a certain period of time and upon your death. Depending on the fund contract, 75% to 100% of your principal will be protected after 10 years.

Guarantees may seem like a good thing to a consumer, but when it comes to financial products, guarantees are often expensive to provide and therefore to purchase. It is also very unlikely for a diversified investment portfolio to have a negative return over a 10-year period, meaning the guarantee may have virtually no value…

One of the most common questions out there is whether to invest in a registered retirement savings plan (RRSP) or a tax-free savings account (TFSA). Both will help you save, and save on taxes, but each works in a different way. Understanding how these accounts work will help you decide which is best for your current needs—and even when to use them in tandem.
What is a TFSA?
A TFSA (or tax-free savings account) is a registered investment savings account that any Canadian resident, aged 18 or older, can use for straightforward savings or to hold investments. It can store things like exchange-traded funds (ETFs), guaranteed investment certificates (GICs), bonds, stocks and cash.
Any income earned in the account—even when it is withdrawn—is tax-free. This means any interest, stock dividends and capital gains earned in your TFSA aren’t subject to income tax. However, your TFSA contributions won’t reduce your taxable income like RRSP contributions will.
There’s a limit on the amount of money you can contribute to your TFSA is annually…