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7 tips for planning your withdrawal plan

October 3, 2022

To have a retirement that meets your expectations, it’s not enough to accumulate savings and to grow your investments. What you may not know yet is that it’s equally important to plan ahead how you’ll withdraw funds from your retirement savings.

The challenge is to keep as much as possible in your pocket and therefore, pay only what is necessary to governments in the form of taxes. Tax efficiency is at the heart of what is called the withdrawal plan, even if there are other aspects to consider.

Le plan de décaissement : qu’est-ce que c’est?

Globalement, le plan de décaissement vous permet de déterminer les retraits qui seront effectués de vos différents placements. Il doit prendre en compte le nombre d’années que vous pensez passer à la retraite, de même que l’épargne disponible et vos besoins afin de vous assurer d’éviter de survivre à vos économies.

Discover 7 tips to help you set up your withdrawal plan and make the most of the money you’ve set aside for retirement.

1. Minimize the effect of your withdrawals on your tax liability and income

It’s important to plan for your investment savings withdrawals over time, taking into account the age at which you will begin to draw on them, your other retirement income sources, your tax rate and the tax impact of each investment type.

Your withdrawal plan will allow you, among others, to allocate withdrawals between your registered and non-registered investments, taking into account the impact on your tax bill. For example, you should consider that:

  • Any withdrawal from an RRSP or other tax-deferred account, such as a Voluntary Retirement Savings Plan (VRSP), Life Income Fund (LIF) or Registered Retirement Income Fund (RRIF) is taxable
  • Income (dividends, interest or capital gains) or proceeds from the sale of securities in non-registered investment vehicles are taxed differently

You should also be aware that all taxable withdrawals are added to your income and may affect your eligibility for certain income-based social credits or programs (GST/QST credit, the Guaranteed Income Supplement and the Old Age Security pension).

A well-planned, customized strategy will help you determine the best withdrawal order for your situation, taking into account all your sources of income.

2. Plan all your major expenses

Are you thinking about renovating your home, changing your vehicle or moving to Florida for a few months? It’s important to include these significant expenses in your withdrawal plan to avoid large withdrawals that could result in a tax bill and impact your investments or long-term retirement plan.


L’augmentation du coût de la vie est malheureusement inévitable et doit être reflétée dans votre plan de décaissement. Afin de maintenir votre niveau de vie, vous devrez sans doute prévoir une augmentation des retraits au fil des ans. Référez-vous à un conseiller si vous avez besoin d’aide pour comprendre l’impact de l’inflation sur votre plan de décaissement. Il pourra vous guider vers d’autres professionnels, comme des fiscalistes, au besoin.

3. Give yourself flexibility to deal with the unexpected

Since life is full of surprises, it’s best for your withdrawal plan to take into account the risk of unplanned expenses. With that in mind, you should leave yourself some leeway or even consider setting up an emergency fund.

Volatilité des marchés

Vous devez également faire attention de ne pas sous-estimer l’évaluation de vos dépenses ni être trop optimiste du côté de vos revenus de placement. Vous devez garder en tête que la performance des marchés, particulièrement au moment du retrait, influence la valeur du portefeuille et le montant des retraits futurs.

4. Continue to grow your retirement capital

Just because your withdrawal plan is ready or you’ve started to withdraw money from your retirement investments doesn’t mean you should stop investing. On the contrary, you can generate returns, even in retirement.

By updating your investor profile, you can be assured that your investments are always tailored to your situation and your needs.

5. Evaluate your estate tax bill at death

At the time of your death, the law provides that all your assets will be deemed to have been sold at their fair market value. Your estate will therefore have to pay tax, if applicable, on the amounts held in tax-deferred investments (RRIFs, LIFs) and on gains realized on the sale of other assets.

That’s why it’s important to think now about who you’ll leave your assets to so you can implement strategies to reduce or defer taxes payable upon your death and incorporate them into your withdrawal plan.

6. Review your withdrawal plan and adjust it as needed

Compliance with your withdrawal plan is essential to its effectiveness, but it’s also important to review it periodically. In the event of an unforeseen event, a change in situation or market turbulence, you’ll be able to adjust the amount to be withdrawn or review your strategy to successfully maintain the planned withdrawal period. That way, you can plan for your retirement and try to make your retirement capital last as long as possible.

When setting up your portfolio withdrawal plan, you should also provide for a certain level of flexibility that would allow you to adjust withdrawals. Indeed, there are several steps to retirement: some are more active and others less so, and expenses follow accordingly!

7. Ask your advisor

Your advisor is your best ally in helping you prepare, implement and review your customized withdrawal plan.