Christopher Liew is a CFP®, CFA Charterholder and former financial advisor. He writes personal finance tips for thousands of daily Canadian readers at Blueprint Financial. You spent decades filling up your RRSP, your TFSA, and maybe a non-registered account. Now that retirement is here (or close), you have to figure out how to empty them, and the order could matter more than you might think. Pull from the wrong account at the wrong time and you could hand the CRA far more than you need to, or see part of your Old Age Security clawed back. Below, I’ll walk through which accounts I’d typically draw from first, and when I’d break the rules. Why the order you withdraw in matters Earlier this year, I wrote about the wrong ways to save for retirement. Spending that money well is just as important, and not having a withdrawal plan was one of the common financial regrets of retirees I flagged in June. The classic rule of thumb is non-registered first, then RRSP or RRIF, then TFSA last. It’s a decent starting point, but in my experience the best plans blend accounts year by year rather than draining them one at a time. With year-end approaching, it’s also a good moment to check how much taxable income you’ve already earned in 2026, since anything you withdraw before Dec. 31 lands on this year’s return. 1. Start with your non-registered account Money in a regular taxable account is the least sheltered dollar you own. Interest, dividends, and realized gains get taxed every year, even if you’re just reinvesting, so this account loses a slice of its return to tax drag annually. Spending it first lets your sheltered accounts keep compounding. That being said, watch your capital gains. If your investments have grown a lot, try to sell in your lower-income years, ideally before you start collecting OAS. Only half of a capital gain is taxable, but that half still counts toward your net income. I’d also keep a modest cash cushion here for emergencies rather than draining the account to zero. 2. Don’t always leave your RRSP untouched until 71 I often see retirees leave their RRSP alone until they’re forced to convert it to a RRIF at the end of the year they turn 71. Instead, consider a bracket-filling approach. In the years between retiring and 71, you could withdraw enough to bring your income to the top of a lower tax bracket without spilling into the next one. This smooths your taxes, shrinks future forced withdrawals, and reduces your estate’s tax bill, since a RRIF is generally taxed in full on your final return unless it rolls to a spouse. At 65, it’s also worth converting part of your RRSP to a RRIF. Those payments qualify for the pension income amount, a federal credit on up to $2,000 of eligible income, and can be split with your spouse on your tax returns to help keep both incomes under the OAS recovery tax threshold for 2026. I walked through this with actual numbers in a recent Blueprint Financial video. 3. Consider using RRSP withdrawals to buy time on CPP and OAS Early RRSP withdrawals could also pair nicely with delaying your government pensions. CPP payments rise by 0.7 per cent for each month you wait past 65, up to 42 per cent more at 70. OAS offers a smaller but similar boost if you defer it. Living off your RRSP in your 60s while you wait essentially swaps a taxable account for bigger, inflation-indexed income for life. I think it’s one of the most underrated moves in Canadian retirement planning. It isn’t for everyone, though; if your health is poor or your savings are thin, starting earlier can make more sense. 4. Treat your TFSA as a flexible reserve, not just the last stop Your TFSA is the most flexible account you have. The CRA confirms your OAS and Guaranteed Income Supplement (GIS) won’t be reduced by TFSA income or withdrawals. That makes it the ideal source of cash in a year when you’re near the clawback, selling a property, or facing a big one-time expense. It’s also your best buffer in a down market, since you can spend from it instead of selling RRIF investments at a loss. And if your RRSP withdrawals exceed what you spend, move the extra into your TFSA, if you have room, so it grows tax-free from here on. If you expect to qualify for GIS, I’d go further and move the TFSA to the front of the line, since keeping taxable income low is what protects that benefit. 5. Fit your other income around the plan If you have a defined benefit pension or an annuity, treat it as your income floor. Then plan your RRSP or RRIF withdrawals around it so you stay in your target tax bracket. Rental income works the same way, and in a year with big repairs or a vacancy, your TFSA can cover the gap. If you own a business with money in a corporation, you have extra levers, like timing dividends for your lower-income years. Your home is your last-resort safety valve. A home equity line of credit set up while you still qualify can cover short-term needs in a down market, so you don’t have to sell investments at a loss. A reverse mortgage comes with higher interest and fees, so I’d use it selectively, usually later in life to fund care or stay in your home longer. Final thoughts There’s no single withdrawal order that works for everyone. Your pensions, health, spouse, and estate goals all shift the answer, and the right mix usually changes from year to year. What matters is having a plan before you start pulling money out, rather than letting the RRIF rules make the decisions for you. A few hours of planning now could save you thousands later.
