When most people hear “financial planning” they immediately think about saving and investing for retirement. While retirement savings are a key part of it, effective financial planning is far more comprehensive—especially for those approaching or already in their 70s. This guide outlines practical strategies for retirement income, tax efficiency, estate planning and investment management to help seniors and their families make informed decisions.
If you are not yet in your 70s, save this for later or share it with older family members who may benefit from reviewing these topics with their advisors.
RRSPs
An individual can hold a registered retirement savings plan (RRSP) only until December 31 of the year they turn 71. By that deadline the RRSP must be converted to a registered retirement income fund (RRIF) or used to purchase an annuity that provides lifetime income. The conversion age was raised from 69 to 71 in 2007, so confirm your timeline with a planner—some people still mistakenly believe the older rule applies.
It can be sensible to take RRSP withdrawals before age 72 and to convert to a RRIF as early as age 65 in some situations. RRIFs require minimum annual withdrawals that increase with age: at age 72 the mandated minimum is 5.28% of the RRIF value as of December 31 the previous year, and the percentage rises gradually each year. These minimums effectively force the drawdown of registered capital and result in taxable income during retirement.
If you still have RRSP contribution room after age 71, you can contribute to a spousal RRSP for a spouse who is 71 or younger. Whether contributing remains the right move depends on your full financial picture and tax strategy.
TFSAs
Tax-free savings accounts (TFSAs) have been available since 2009 and are a powerful tool for retirees. Contributions, withdrawals and investment growth inside a TFSA are tax-free, making them ideal for holding cash or non-registered investments that would otherwise generate taxable income.
Many retirees receive sudden inflows of cash—inheritances, proceeds from downsizing a home, or a real estate sale—and these funds are often excellent candidates for TFSA contributions. If you’re holding non-registered assets, consider moving some to a TFSA to preserve future tax-free growth and withdrawals.
Beneficiary designations
Accounts such as RRSPs, RRIFs and TFSAs allow beneficiary or successor designations that can greatly simplify estate settlement. Naming a beneficiary may avoid probate, reduce legal fees, and speed asset transfer to heirs.
Most RRSP and RRIF holders name their spouse as beneficiary. When an RRSP or RRIF is left directly to a spouse, it can often transfer on a tax-deferred basis. Leaving these registered accounts to a non-spouse generally causes the full account value to be included on the deceased’s final tax return, though exceptions exist for financially dependent children or grandchildren.
Important: a beneficiary designation on an RRSP does not automatically carry over when the plan becomes a RRIF—confirm or re-state beneficiary choices at conversion. For TFSAs a surviving spouse can be named as a successor holder rather than a beneficiary; successor holder status allows the spouse to continue the TFSA without triggering tax consequences, which is usually preferable.
Note that Quebec law differs: RRSP, RRIF and TFSA beneficiaries cannot be designated directly on the account in Quebec and must be named in a will instead.
Joint ownership of assets
Some parents add children as joint owners on bank accounts, investment accounts or real estate. By default this often creates a “resulting trust” scenario where the parent remains the beneficial owner and the child holds title as a trustee, rather than an outright gift. If the intention is to gift a portion of the asset, document it clearly to avoid confusion and unexpected tax consequences.
Gifting capital assets such as stocks or real estate can trigger capital gains and may affect eligibility for the principal residence exemption. Joint ownership also exposes assets to a child’s creditors or a spouse in a divorce and can lead to disputes if intentions are unclear. While joint ownership can speed up estate settlement or avoid probate, it carries legal and tax risks that deserve careful consideration and documentation.
Probate
Probate (also called estate administration tax) is a provincial process that validates a will and authorizes an executor to distribute the estate. Probate costs vary significantly across Canada: some jurisdictions such as Alberta, Quebec and the northern territories have minimal probate fees, while provinces like British Columbia, Ontario and Nova Scotia can charge substantial fees for large estates.
Beneficiary designations and joint ownership are common ways to minimize probate exposure. Other estate planning tools—alter ego or joint partner trusts, bare trustee corporations, and secondary wills for specific assets—may also be useful to manage probate risk and preserve estate value.
Investment strategy
Investment planning should anticipate changes in capacity and risk tolerance. Regulators now recommend naming a Trusted Contact Person (TCP) who can be reached if a financial firm has concerns about exploitation or a client’s mental capacity. A TCP helps protect older investors from fraud and can facilitate timely intervention.
Self-directed investors should put a transition plan in place long before they might be unable to manage their accounts. Discuss your investment strategy with a spouse or family member who may take over, and consider pre-selecting a portfolio manager or power of attorney for financial decisions. As people age, risk tolerance often declines—either naturally or because a less risk-tolerant spouse or family member assumes control—so align asset allocation with both financial needs and the planned manager’s style.
Tax
Tax planning remains crucial in retirement. Thoughtful decumulation—how and when you withdraw taxable and non-taxable assets—can minimize lifetime tax. In some cases selling assets gradually or using strategies to “freeze” asset values can reduce tax liabilities at death.
Large tax bills triggered by death can create liquidity problems, particularly when an estate includes real estate or a business. If there isn’t cash available to pay taxes, heirs may need to sell assets quickly or use personal funds to settle obligations. Planning for estate liquidity—through insurance, cash reserves, or tax-efficient asset placement—avoids forced sales and preserves wealth for beneficiaries.
Summary
Financial planning in your 70s touches many areas: income design from RRSPs and RRIFs, tax-free growth in TFSAs, clear beneficiary designations, careful use of joint ownership, probate mitigation, investment transition plans and tax-efficient decumulation. This overview highlights key topics to discuss with your financial advisor, tax professional and family so you can protect your assets, reduce taxes and make estate settlement smoother for your heirs.
Read more about financial planning:
- Earning, saving and spending money in Canada: A guide for new immigrants
- Credit scores and credit reports: What newcomers to Canada need to know
- Could a line of credit affect my mortgage application?
- Applying for a credit card: What you need to know