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I have heard of

  • Locked In Retirement Accounts (LIRAs) also known as Locked-in Retirement Savings Plans (LRSPs)
  • Registered Retirement Savings Plans (RRSPs)

How are they different and what are the advantages and disadvantages of each?

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The difference is the lock-in. :-)

An RRSP is contributed-to when you feel like it, and money can be removed under various circumstances (including the home-buyers program).

A locked-in plan is often the result of a pension conversion upon leaving a place of employment. When I left a company, I had three options for my pension. Leave it, transfer it to a receiving pension plan, or convert it to a Locked-in RSP.

The premise here, at least in part, is that given there are various tax advantages to the money growing tax-free, you have therefore allowed yourself to be limited in your withdrawal options.

Hope that helps

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