RRIF Minimums Get Pricier When You Wait

In Canada, RRSPs had to close by Dec. 31 of the year someone turned 71, often moving into a RRIF with taxable minimum withdrawals.
Those minimums were based on the account’s Jan. 1 value and age factor, starting near ~5% in early years and reaching ~20% from age 95.
A hypothetical $500K RRSP compounding at ~5% for seven years grew to ~$704K, pushing an age-72 minimum near $38K instead of $27K.
That extra taxable income could matter once CPP, OAS, workplace pensions, or investment income start, with the 2026 OAS recovery tax applying above >$95K.
Using lower-income years for partial withdrawals, pension-income splitting, a younger spouse’s age for RRIF setup, and TFSA contributions may spread taxes more deliberately.