How much to take out of your RRSP in your 60s Oct 5th

Not sure how to make a retirement plan? Read on…
Many retirees have the bulk of their retirement savings in registered retirement savings plans (RRSPs) or similar tax-deferred registered accounts. RRSPs need to be used to buy an annuity or more commonly converted to a registered retirement income fund (RRIF) by Dec. 31 of the year someone turns 71. Required RRIF withdrawals begin the next year, with each withdrawal based on a percentage of the account value. 

Locked-in RRSPs, defined contributions (DC) pensions, and deferred profit sharing plans (DPSPs) all have the same rule requiring conversion at age 71. 

The two big questions for a retiree prior to age 71 are: When should I start withdrawals? And how much should I take out each year?

If we take a simplistic approach to the RRSP drawdown, a sustainable withdrawal rate may be 2% to 5% of the account value. That is, between 2% and 5% of the starting account value may be withdrawn each year with subsequent withdrawals increased each year with inflation for life. There are many asterisks depending on age, life expectancy, investment risk tolerance, investment fees and other factors…

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