RRSP / RRIF Meltdown Calculator
Your RRSP is not an asset. It is an asset with a tax bill attached.
Whatever is left in the account is added to income in a single year at the end. This works out how much of it goes to the CRA instead of your family, and what changes if you draw it down on purpose.
If nothing changes
goes to the CRA instead of your family — at its worst around age 72. The top combined marginal rate in Ontario is 53.53%.
Forced out this year
5.40% · age 72
OAS clawed back
doing nothing
Plain meltdown adds
by age 95
Loan meltdown adds
by age 95
What your family actually receives
After every income tax, and after any loan is repaid in full.
- Do nothing
- Plain meltdown
- Loan meltdown
Where the loan strategy stops working
The investment has to return about 0.84% a year for the loan strategy to be worth doing to age 95. It does not have to beat its own 5.20% interest, because it also moves money out of an account taxed at 53.53% into capital gains taxed at roughly half that. Below that return, borrowing costs your family money.
Year by year
| Age | Forced % | Forced w/d | Do nothing | Plain meltdown | Loan meltdown | Meltdown adds | Loan adds |
|---|---|---|---|---|---|---|---|
| 72 | 5.40% | $27,000 | $247,017 | $247,149 | $249,266 | $132 | $2,249 |
| 73 | 5.53% | $27,465 | $244,998 | $248,628 | $250,108 | $3,631 | $5,110 |
| 74 | 5.67% | $27,933 | $242,658 | $250,261 | $251,076 | $7,603 | $8,418 |
| 75 | 5.82% | $28,399 | $239,209 | $251,283 | $251,402 | $12,074 | $12,193 |
| 76 | 5.98% | $28,855 | $236,205 | $253,305 | $252,694 | $17,100 | $16,489 |
| 77 | 6.17% | $29,391 | $232,772 | $255,502 | $254,124 | $22,731 | $21,352 |
| 78 | 6.36% | $29,848 | $228,976 | $257,980 | $255,797 | $29,005 | $26,821 |
| 79 | 6.58% | $30,363 | $224,729 | $260,713 | $257,678 | $35,984 | $32,949 |
| 80 | 6.82% | $30,869 | $220,032 | $263,752 | $259,819 | $43,720 | $39,787 |
| 81 | 7.08% | $31,354 | $214,878 | $267,151 | $262,266 | $52,273 | $47,388 |
| 82 | 7.38% | $31,887 | $209,199 | $270,915 | $265,018 | $61,715 | $55,818 |
| 83 | 7.71% | $32,397 | $203,004 | $275,115 | $268,144 | $72,111 | $65,140 |
| 84 | 8.08% | $32,900 | $196,291 | $279,804 | $271,686 | $83,513 | $75,395 |
| 85 | 8.51% | $33,444 | $188,974 | $285,015 | $275,672 | $96,041 | $86,698 |
| 86 | 8.99% | $33,940 | $181,067 | $290,847 | $280,195 | $109,781 | $99,129 |
| 87 | 9.55% | $34,454 | $172,516 | $297,358 | $285,300 | $124,842 | $112,784 |
| 88 | 10.21% | $34,983 | $163,281 | $304,299 | $291,056 | $141,018 | $127,775 |
| 89 | 10.99% | $35,501 | $153,340 | $311,437 | $297,558 | $158,097 | $144,218 |
| 90 | 11.92% | $35,987 | $142,679 | $319,175 | $304,919 | $176,495 | $162,239 |
| 91 | 13.06% | $36,466 | $131,260 | $327,860 | $313,253 | $196,600 | $181,993 |
| 92 | 14.49% | $36,933 | $119,049 | $337,117 | $322,707 | $218,068 | $203,657 |
| 93 | 16.34% | $37,394 | $106,010 | $350,785 | $333,457 | $244,775 | $227,447 |
| 94 | 18.79% | $37,774 | $91,391 | $365,529 | $345,756 | $274,138 | $254,365 |
| 95 | 20.00% | $34,284 | $77,981 | $379,704 | $360,784 | $301,723 | $282,803 |
The two green columns are what your family gains over doing nothing. Each row asks what happens if that year were the final one — after every income tax, and after any loan is repaid.
How this works, and what it leaves out
- —A meltdown means withdrawing more than the legislated minimum in years when your rate is low, and moving the money somewhere it will never be taxed the same way again — a TFSA first, which is never taxed again even on the final return, then a non-registered account where only the growth is taxed, at half inclusion.
- —The loan version works because the interest is deductible. The deduction shelters an extra withdrawal of the same size, so money leaves the plan at no current tax cost while the borrowed capital is invested alongside it.
- —Forced withdrawals begin the year after an RRSP becomes a RRIF, which must happen by the end of the year you turn 71. The percentage is legislated and climbs every year — 5.40% at 72, 8.51% at 85, 20% from 95.
- —OAS clawback is included. Above about $93,500 of income you lose 15 cents of OAS for every extra dollar. For many retirees that costs more than the income tax does.
- —Estate figures assume the account is not rolled over to a spouse. A spousal rollover defers the bill rather than removing it — the same tax lands later, usually on a bigger account.
- —Probate is not in the numbers above. In Ontario it is 1.5% above $50,000. It depends on how the accounts are titled: a registered account with a named beneficiary avoids it, and so does a segregated fund contract. An ordinary non-registered investment account does not.
- —Tax is combined federal and provincial, including the Ontario surtax where it applies. Every figure here is a with-versus-without difference, so personal credits cancel out.
What do these numbers mean in your own situation?
Thirty minutes on your accounts, your income and your timeline.
Illustration only — a tax projection, not tax or legal advice. Confirm your actual income, province of residence and account structure with your accountant before acting. Rates and statutory factors last verified 2026-09. Wallace Wang Financial Services holds LLQP licensing (life insurance and segregated funds) in Ontario, Alberta, British Columbia, Saskatchewan and Manitoba, carries E&O coverage and is FundServ registered. Nothing here is a recommendation of any specific security or mutual fund. An investment loan is leverage and magnifies losses as well as gains.