A locked-in retirement account (LIRA) is a retirement savings program where you can deposit all funds acquired from a pension plan. Employed persons are entitled to have a pension plan during their employment period. When you lose or leave a job, your accumulated pension fund may be transferred to a LIRA.
Who should have a LIRA account?
Any employed person with a registered pension plan should be thinking of a LIRA account. If you wish to transfer your pension funds after exchanging employers, then you ought to consider a LIRA. The account allows you to have a certain control over your investments.
Characteristics and benefits of a LIRA account
- With a LIRA plan, you enjoy an income tax deferral on all your investment returns
- It may protects your invested capital from financial market fluctuations to over 100%
- It allows you to protect your saved money from potential creditors
- You can increase your contributions by borrowing through the Ecoflex RRSP line of credit
Note: Certain terms and conditions may apply
According to the regulations, you cannot redeem money from your LIRA account under any circumstance unless it’s converted to a life income fund (LIF), or any other retirement income plan before 31st December of the year you will turn 71.