Considering there is no age minimum to open a Registered Retirement Savings Plan (RRSP), you might hold an account for decades. At some point, you may want to move that account from one financial institution to another. This guide walks through how — and why — to do that, how long it takes, and how to avoid any major tax implications along the way.
What is an RRSP transfer?
An RRSP transfer lets you move money, investments, or both from one RRSP account to another. It's often done directly between two financial institutions and can take anywhere from a few days to six weeks to process. You can swap institutions at any time, as long as you're 71 or younger at the end of the year in which you make the transfer.
Reasons to transfer an RRSP
Lower fees. Management fees can range widely between institutions, and while a few tenths of a percentage point might not sound like a lot, those fees can really add up over time.
Consolidation. It's easy to end up with more than one RRSP in more than one place. Bringing them together into a single RRSP, or into multiple RRSPs at one institution, can make for much easier management.
Better investment options. Not every institution offers the same investment products, whether it's access to specific funds or types of assets, like private credit or venture capital. People who feel restricted can switch to a provider that offers the products they're looking for.
Loyalty perks. Many financial institutions offer benefits based on how much you hold with them. Lower commission fees, higher interest rates, and other perks could be unlocked the more you keep your investments together.
Types of RRSP transfers
Whichever transfer method you choose, it's important to have the transfer initiated by a financial institution. If you withdraw the money yourself to move it to a new institution, the government considers that an RRSP withdrawal and you'll be on the hook for the related taxes. Your financial institution may charge a fee of $50 to $150 (per account, usually plus tax) to execute the transfer, though sometimes the institution you transfer to will cover that charge.
Partial transfers vs. full transfers
RRSPs can hold many different types of assets, including cash, stocks, and bonds. Just because you're moving some of those assets doesn't mean the rest have to come along for the ride.
Partial transfer: moves certain assets from one RRSP account to another, while leaving others untouched.
Full transfer: moves the entire book of assets and holdings from one RRSP account to another.
In-kind transfers vs. in-cash transfers
The term "in-kind" is just another way of saying "as-is." An in-kind transfer swaps one institution for another without making changes to the contents of the account. You can only complete an in-kind transfer to an institution that offers the investment options you currently own. A key advantage is that you do not need to sell your securities to move them; they are simply held by a different institution.
In-cash RRSP transfers first liquidate the assets in one account before moving the balance to a new account as cash. This type of transfer is commonly used when changing investment strategies, or when taking advantage of investment options that weren't offered by the previous institution.
How to transfer your RRSP
Although the process varies based on the institutions you're transferring from and to, here's the gist.
Open the new RRSP account at the institution you want to move to. You can't transfer anything to an account that doesn't exist.
Initiate the transfer. This often happens through the institution receiving the new account, since they're keener to get your money than the old institution is to give it away. You'll need the most recent statement from the RRSP account you are transferring, and you'll also need to designate the type of transfer (partial or full, in-kind or in-cash).
Wait. Some transfers take a few days; others take weeks, sometimes more than a month. Follow up in case of any delays.
How long does an RRSP transfer take?
Transfer times vary based on the institutions involved and the type of transfer you request. Electronic transfers between major institutions can settle in a few business days, while transfers involving paper forms, guaranteed investment certificates (GICs), or mutual fund companies often take longer.
As a general guide, expect these ranges:
Cash transfers: roughly 3 to 5 business days.
In-kind transfers: roughly 1 to 2 weeks.
Institutions without electronic processing: 2 to 6 weeks.
If your transfer passes the expected window, follow up with the institution receiving your account, since it usually manages the request.
Are there tax implications when you transfer an RRSP?
A direct transfer between two RRSPs is not taxed, because the money never leaves the registered system. To keep it tax-free, the transfer has to move directly from one institution to another rather than passing through your hands.
If you withdraw the funds yourself and try to redeposit them, the government treats the amount as an RRSP withdrawal. That triggers withholding tax, and the amount is added to your income for the year. Having the institution initiate a direct transfer avoids this entirely.
Can you transfer an RRSP to your spouse?
You generally cannot transfer your RRSP directly to your spouse while you are both living. An RRSP has to stay with the same account holder, so moving it to your spouse would be treated as a withdrawal and taxed as income.
There are two main exceptions. On the breakdown of a marriage or common-law partnership, funds can be transferred directly to the other partner's RRSP using the appropriate government form. And when you pass, your RRSP can transfer to a spouse or common-law partner named as your beneficiary, often on a tax-deferred basis.
If your goal is to balance retirement savings between partners, a spousal RRSP is the tool designed for that purpose.
