When you have a job transition, you may transfer your pension plan savings to a locked-in-retirement account (LIRA).
LIRA’s are similar to Retirement Savings Plans (RSP’s) but with more restrictions. Adding another investment account will also add extra administration to managing your retirement savings.
Alberta pension legislation allows people age 50 or older to transfer LIRA’s worth less than $21,440 to an RSP at any time. The actual “un-locking” requires a few steps which is summarized in a single letter of direction to your financial institution. It is important to state that you are under 65 years of age and that you do not own any other LIRA’s at other financial institutions.
In the first step, indicate your intention to open a Life Income Fund (LIF). This allows you to initiate the one-time “un-lock” of 50% of the LIRA’s value. Instruct them to move 50% to your RSP. Your spouse must sign a pension-partner-spousal-waiver allowing the pension savings to be un-locked. Include this with the letter of direction.
If you would like more information or have any questions, feel free to contact us at 780.466.6204, or click here to send us an email.
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