Converting RRSP to RRIF | RRSPs and RRIFs | Discussion forum

You are indeed correct to think about starting this process early in the year. You can read some of my earlier posts on the subject.

Based on my varied experiences, I would not initiate a transfer in December and expect it would necessarily be completed by year end. On one occasion, I tried to simply cash out an LIRA in December, and even that proved impossible. I had to wait til the following year. An RSP took a few weeks to close. And two RIFs which I tried to close proved not to actually be closed. One FI came close to refusing to switch my RSP to RIF in May of the year I turned 71. So, I have become quite skeptical about the ease with which these transitions happen. Some have been perfectly fine, but you just don't know what will happen until you do it.

My main piece of advice would be to get the RSP-RIF conversion done early in the year. There is no advantage really in postponing this. It will ease your mind. And you never know, if you should have a health crisis or whatever, it's best to have this behind you as there is a deadline.

Some FIs will apparently convert for you automatically at year end. I had an RSP at Hubert which was empty (I had never used it). At year end, it morphed into an RIF automatically. However, you shouldn't rely on this, for at least 3 reasons. First, you just don't want to trust that it will happen. Second, you need to fill out new beneficiary when you convert. And third, you want to choose the date when the mandatory withdrawals will occur. Further, if you are the older spouse, you will likely want to choose your spouse's age to determine the rate of mandatory withdrawal. All of these things require your personal intervention. Many FIs don't ask you about the spouse thing, and some (to my surprise) seem not to know about it. You can't change it afterwards, so make sure you get it right in the first place.

Good luck!

Ha-ha!
I actually figured a while ago while thinking about this that you could probably keep an RSP or RIF going almost indefinitely if each widowed planholder remarried. and the new spouse added a little leavening to the mix. It's sort of like grafting trees or taking slips off a plant and rooting them... or something... the gift that keeps on giving. CRA may never get the residue!

Actually, I think the big banks are better in handling RIFs - generally. They seem more used to the routine. I've gotten some strange responses at some of the smaller institutions. But I'm sure you'll agree that it's best to get it right in the first place.
And the thing is, if you aren't in control of the process of conversion, you don't control what the date is for the automatic withdrawal. It could be January 2, in which case you have no opportunity to update the file according to your wishes. I found it quite scary when Tangerine refused to let me convert when I wanted to do so. I was never quite sure they had followed my instructions. I just cashed it all in - or at least I tried to. Despite assurances that the interest was calculated to date when I told them to close it down, there is still a small balance that I still have to deal with. Grrr.
Finally, however (touch wood), the RIF I had at TD, with six cents in it, seems to have disappeared - at least i've not gotten a statement this time around.

I suppose you could try that.
But if you were doing it within the same FI, and the FI were Tangerine, I think they would be scratching their heads and might even ignore you. They understand transfer forms to be to another FI. It was they who initially refused to convert mine on my request. They said they'd do it at the end of the year, but I wanted it done during the year so that it would be eligible for pension splitting and pension tax credit. They were so uninformed that they didn't even understand these issues - not that the reason should have mattered. I finally got my way; and then I cashed it out in December - all except for the $7.14 interest which popped up at the end despite assurances that interest to date was included in the withdrawal. Not a big deal, but a nuisance. - another line
item on my income for another year.

I'm so glad to be done with these conversions!
Everything that remains in RIFs will be moved to Accelerate or Achieva starting in June, and I intend to leave it there until it's gone. This should make it easier for my POA, as they won't have to do anything with it - I hope.

Tangerine didn't provide any kind of form when I was dealing with them, and that's part of why it was scary.