A Locked-in Retirement Account (LIRA) is an account designed to hold a former pension plan member’s funds from a locked-in pension. Typically, people who are not yet retired will open a LIRA after leaving a job with a pension.

At retirement, LIRAs can be used to purchase retirement income (through LIFs, which are similar to RRIFs) or converted into an annuity. Like an RRSP, a LIRA must be closed by December 31 of the year that you turn 71.

You can open:

• multiple managed accounts
• up to 8 self-directed accounts

Before you begin

• If you opened a LIRA under the wrong jurisdiction, you will have to close the erroneous account first before opening a new one.
• LIRAs work a little differently than other accounts at Wealthsimple since funds are locked in. This means that, unlike other accounts, you cannot deposit funds into a LIRA or withdraw funds from a LIRA.
• LIRAs can only be funded by transferring in an existing LIRA/locked-in portion of a pension or moving funds between LIRA accounts.
• The jurisdiction of a new LIRA must match the jurisdiction of the LIRA or pension where the funds are coming from. You can usually confirm the jurisdiction on your account statement, pension package, or with your plan administrator.

Open a LIRA with Wealthsimple

To open a LIRA with Wealthsimple, follow these steps:

1. Log in to the Wealthsimple mobile app
2. Under Accounts, scroll down and select + Add an account
3. Select Open a new account
4. Choose the LIRA account type
5. Review if this account is right for you, then tap Next
6. Select your Jurisdiction (make sure it matches the jurisdiction of the LIRA or pension where the funds are coming from) and tap Next
   
   Tip: If you're unsure which jurisdiction your account was created in, you can check your account statement or reach out to your financial institution for help
7. Choose the age you wish to retire and tap Continue
8. Choose a theme for your portfolio and tap Continue
9. Confirm your risk level
10. Review your agreements and Confirm your account opening

Frequently asked questions 

Can I withdraw from my LIRA?
Early withdrawals from a LIRA account may be permitted if the account holder experiences financial hardship (such as having a low income, medical emergency, etc.) or non-financial hardship (such as becoming a non-resident, a shortened life expectancy, etc.). 

The jurisdiction of your LIRA determines the criteria for early withdrawals through unlocking. Please contact our support team if you have any questions.

What are the fees in a managed LIRA with Wealthsimple?
Wealthsimple’s standard management fee is 0.5%. For accounts over $100,000, this fee drops down to 0.4%. To learn more about fees, click here.

Can I hold cash in a managed LIRA instead of investing my funds?
No, there is no option to hold cash in managed accounts. However, you can consider moving your portfolio to our high-interest savings ETF option for a no-risk investing alternative.