what does life income fund mean 
a life income fund lif is a type of registered retirement income fund rrif in canada that can be used to hold locked in retirement accounts liras and other assets for retirement income a lif is meant to live up to its name and funds aren t to be withdrawn in a lump sum owners must use it to support retirement income regular updates to canada s income tax act set the minimum and maximum withdrawal amounts for rrifs which include lifs though these limits and other aspects of a lif depend on the province in which the pension plan was set up 1 the annual maximums and minimums may account for your balances in other funds and annuities withdrawals from a lif are taxed as income in the year they are received in most provinces you must convert your lira to a lif by the end of the year when you turn 71 understanding life income fund lif lifs are offered by canadian financial institutions they are plans for managing payments from locked in pension funds and other assets in many cases pension assets aren t accessible when an employee leaves a firm these assets usually called locked in can be managed through other plans however you might need to move the funds into a lif once you re ready to begin withdrawals most provinces in canada require that lif assets be invested in a life annuity in many provinces lif withdrawals can begin at 50 if the income is used for retirement income 2once you begin taking lif payouts you ll have to ensure you mean the minimum and maximum for each year your financial institution for the lif will have this information which is updated regularly through canada s income tax act and has sections that regulate all rrifs the financial institution from which the lif is issued must give you annual statements for the lif based on the annual statement you must specify at the beginning of each fiscal year the amount of income you would like to withdraw this must be within a defined range to ensure the account holds enough funds to provide lifetime income for the lif owner qualified investments include cash mutual funds exchange traded funds securities listed on a regulated exchange corporate bonds and government bonds 2life income fund lif ruleshere are some general rules about lifs 3advantages and disadvantages of a life income fund lif setting up a lif has several advantages 14there are some disadvantages to setting up a lif they include the following contributions grow tax deferred within a lif account