Locked-In Retirement Account - LIRA


DEFINITION of 'Locked-In Retirement Account - LIRA'

A type of registered retirement savings alternative that locks in the pension funds in investments. While the funds are locked in, they are unavailable for cash-out. Pension funds that are transferred to a LIRA are used to purchase a life annuity, transferred to a life income fund (LIF) or to a locked-in retirement income fund (LRIF). Upon reaching the retirement age, the life annuity, LIF and/or LRIF provide a pension for life.

BREAKING DOWN 'Locked-In Retirement Account - LIRA'

The locked-in retirement account is designed to hold pension funds for a former plan member, former spouse or common-law partner or a surviving spouse or partner. The LIRA may be elected at any age to hold funds transferred from a pension plan upon the termination of membership in a pension plan; the disintegration of a marriage or common-law partnership; or death before retirement. Unlike RRSPs, which can be cashed in whenever the owner decides, a locked-in retirement account does not provide such an option.

  1. Form 8891

    An IRS form that must be completed by any U.S. citizen or resident ...
  2. Registered Pension Plan - RPP

    A form of a trust that provides pension benefits for an employee ...
  3. Registered Retirement Income Fund ...

    A retirement fund similar to an annuity contract that pays out ...
  4. Registered Retirement Savings Plan ...

    A legal trust registered with the Canada Revenue Agency and used ...
  5. Canada Pension Plan - CPP

    One of three levels of Canada's retirement income system, which ...
  6. Canada Revenue Agency - CRA

    A federal agency that collects taxes and administers tax laws ...
Related Articles
  1. Savings

    Tax-Saving Tips For Canadian Taxpayers

    Find out how to get a bigger return.
  2. Taxes

    Tax-Free Accounts Make Saving A Snap For Canadians

    In 2009, the Canadian government began allowing citizens to save more tax-free dollars than ever.
  3. Retirement

    Maxing Out Your RRSP (Canadian)

    Increasing your savings will provide tax benefits - and peace of mind.
  4. Taxes

    Registered Retirement Savings Plans (RRSP)

    Learn how the Canadian government makes saving for your post-work years easy. We take you from your first contribution to your first withdrawal.
  5. Retirement

    Should Social Security Be Privatized?

    The idea of controlling your own retirement money is one that continues to hold appeal for a large segment of voters.
  6. Insurance

    What's The Difference Between Medicare And Medicaid?

    One program is for the poor; the other is for the elderly. Learn which is which.
  7. Insurance

    Cashing in Your Life Insurance Policy

    Tough times call for desperate measures, but is raiding your life insurance policy even worth considering?
  8. Retirement

    Pros and Cons of Deferred Compensation Plans

    Learn about the pros and cons of non-qualified deferred compensation (NQDC) plans, including the flexibility of non-ERISA plans and the potential for forfeiture.
  9. Mutual Funds & ETFs

    ETFs Vs. Mutual Funds: Choosing For Your Retirement

    Learn about the difference between using mutual funds versus ETFs for retirement, including which investment strategies and goals are best served by each.
  10. Financial Advisors

    How to Help Plan Sponsors Meet Fiduciary Duties

    Advising 401(k) plan sponsors is a great business model for financial advisors. Here's how advisors can help plan sponsors meet fiduciary obligations.
  1. What happens to my Locked-In Retirement Account (LIRA) balance when I die?

    In the event that the owner of a Locked-In Retirement Account (LIRA) dies before reaching retirement age, the balance of ... Read Full Answer >>
  2. Who can transfer funds to a Locked-in Retirement Account (LIRA)?

    To transfer funds, LIRA recipients must meet one of a variety of criteria. Only certain individuals are allowed to transfer ... Read Full Answer >>
  3. What happens to a Locked-In Retirement Account (LIRA) in the case of a divorce or ...

    When a married couple splits the assets in a Locked-In Retirement Account (LIRA), the assets are generally divided between ... Read Full Answer >>
  4. What is the Superintendent's Register of Authorized Institutions?

    The Superintendent's Register of Authorized Institutions is a list kept by the Office of the Superintendent, which details ... Read Full Answer >>
  5. What are the restrictions for withdrawing my Locked-in Retirement Account (LIRA) ...

    As of 2014, assets in a Locked-in Retirement Account are normally not available for withdrawal until converted to a Life ... Read Full Answer >>
  6. Are catch-up contributions included in the 415 limit?

    Unlike regular employee deferrals, catch-up contributions are not included in the 415 limit. While there is an annual limit ... Read Full Answer >>

You May Also Like

Hot Definitions
  1. Barefoot Pilgrim

    A slang term for an unsophisticated investor who loses all of his or her wealth by trading equities in the stock market. ...
  2. Quick Ratio

    The quick ratio is an indicator of a company’s short-term liquidity. The quick ratio measures a company’s ability to meet ...
  3. Black Tuesday

    October 29, 1929, when the DJIA fell 12% - one of the largest one-day drops in stock market history. More than 16 million ...
  4. Black Monday

    October 19, 1987, when the Dow Jones Industrial Average (DJIA) lost almost 22% in a single day. That event marked the beginning ...
  5. Monetary Policy

    Monetary policy is the actions of a central bank, currency board or other regulatory committee that determine the size and ...
  6. Indemnity

    Indemnity is compensation for damages or loss. Indemnity in the legal sense may also refer to an exemption from liability ...
Trading Center