Locked-In Retirement Account - LIRA

AAA

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.

INVESTOPEDIA EXPLAINS '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.

RELATED TERMS
  1. Form 8891

    An IRS form that must be completed by any U.S. citizen or resident ...
  2. Canada Revenue Agency - CRA

    A federal agency that collects taxes and administers tax laws ...
  3. Canada Pension Plan - CPP

    One of three levels of Canada's retirement income system, which ...
  4. Registered Retirement Savings Plan ...

    A legal trust registered with the Canada Revenue Agency and used ...
  5. Registered Retirement Income Fund ...

    A retirement fund similar to an annuity contract that pays out ...
  6. Registered Pension Plan - RPP

    A form of a trust that provides pension benefits for an employee ...
Related Articles
  1. Retirement

    What is the Superintendent's Register of Authorized Institutions?

    Learn who governs locked-in retirement accounts and other registered retirement savings plans in each Canadian province and what institutions they approve.
  2. Retirement

    Who can transfer funds to a Locked-in Retirement Account (LIRA)?

    Transferring funds into a LIRA account can be initiated by owners of defined contribution plans or defined pension plans as well as by LIRA account holders.
  3. Retirement

    What are the restrictions for withdrawing my Locked-in Retirement Account (LIRA) balance?

    Learn about Locked-in Retirement Funds and options available for receiving retirement income. Explore circumstances when early withdrawals may be permitted.
  4. Retirement

    What happens to a Locked-In Retirement Account (LIRA) in the case of a divorce or separation?

    Learn different options in cases of divorce where assets are held in Canadian Locked-In Retirement Accounts. Learn which professionals to ask for advice.
  5. Retirement

    What happens to my Locked-In Retirement Account (LIRA) balance when I die?

    Understand that in the event of your death, Locked-In Retirement Account death benefits will be transferred to your partner, beneficiary or estate.
  6. Savings

    Tax-Saving Tips For Canadian Taxpayers

    Find out how to get a bigger return.
  7. Retirement

    Maxing Out Your RRSP (Canadian)

    Increasing your savings will provide tax benefits - and peace of mind.
  8. 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.
  9. 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.
  10. Many of us fantasize about winning a big lottery jackpot. Let’s say that actually happened? What would you do with the money? How would you manage it?
    Professionals

    Tips For Managing A Cash Windfall

    Many of us fantasize about winning a big lottery jackpot. Let’s say that actually happened? What would you do with the money? How would you manage it?

You May Also Like

Hot Definitions
  1. Multinational Corporation - MNC

    A corporation that has its facilities and other assets in at least one country other than its home country. Such companies ...
  2. SWOT Analysis

    A tool that identifies the strengths, weaknesses, opportunities and threats of an organization. Specifically, SWOT is a basic, ...
  3. Simple Interest

    A quick method of calculating the interest charge on a loan. Simple interest is determined by multiplying the interest rate ...
  4. Special Administrative Region - SAR

    Unique geographical areas with a high degree of autonomy set up by the People's Republic of China. The Special Administrative ...
  5. Annual Percentage Rate - APR

    The annual rate that is charged for borrowing (or made by investing), expressed as a single percentage number that represents ...
  6. Free Carrier - FCA

    A trade term requiring the seller to deliver goods to a named airport, terminal, or other place where the carrier operates. ...
Trading Center