Annuity

Once RRSP eligibility expires the retiree can choose to take out the money at periodic intervals and pay tax on the money taken out each year as income. Or the person can purchase an annuity from a financial firm which gaurantees them a certain amount of money annually for the rest of their natural lives or for a fixed period of time which the issuer and purchaser agree upon. The amount they recieve is based upon the amount of money they use to purchase the annuity and the length of time of the payouts.