Locked-In Retirement Account - LIRA

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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.

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RELATED FAQS
  1. 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 >>
  2. 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 >>
  3. 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 >>
  4. 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 >>
  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 spousal Social Security benefits taxable?

    Your spousal Social Security benefits may be taxable, depending on your total household income for the year. About one-third ... Read Full Answer >>

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