RRSP Centre

• Self-Directed RRSP
• Deduction Limit
• Spousal RRSP
• Investment Options
• Investment Strategies
• RRSP Loans
• How Much Will I Need to Save?
• RRSP Maturity Options
• Annuities
• RRIFs
• Self-Directed RRIF
• How Much Income Will I Need?
• How Long Will My RRIF Last?
• Naming a Beneficiary
• Retirement Planning for Small Business Owners

RRSP Centre

Naming a Beneficiary for your RRSP/RRIF
Do you know who will receive your assets when you die? In general, the assets that form part of your estate will be distributed in accordance with the instructions in your Will. If you don’t have a Will, your assets will be distributed according to the intestacy rules of your province.

Registered plans such as RRSPs and RRIFs provide one more option by allowing you to designate a beneficiary for your accounts so that, upon your death, the named beneficiary will receive the assets in the plan. In Quebec, this designation is made in your Will. You may choose to name your spouse or common-law partner, children or other family members, friends or even a favourite charity. If you don't name a beneficiary, or if you name your estate, the plan will be distributed as described above.

Why name a beneficiary?
By naming a beneficiary, the plan does not form part of the estate assets that require probate. This may result in significant savings in some provinces where the fee is charged on the value of the estate. A beneficiary designation is made in writing directly on the RRSP/RRIF application form and can be changed only by the annuitant.

You should review your designation whenever there is a change in your personal circumstances such as marriage or divorce, death or birth. If you have converted your RRSP into a RRIF, the RRIF is considered a separate plan, and you should ensure that you’ve named a beneficiary either in the plan itself or in your Will.

Tax consequences
It’s also important to consider the tax implications of your choice of beneficiary. Upon your death, the market value of your RRSP/RRIF will be taxed differently if you have named your spouse as beneficiary than it would if you have named a child, grandchild or charity.

For more information, contact an Investment Advisor at a BMO Nesbitt Burns branch near you.

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