Mr. Chen is 73 years old with a RRIF valued at $400,000. He uses his own age for the minimum withdrawal calculation. Due to unexpected medical expenses, he needs to withdraw $50,000 this year. What percentage of his RRIF value would the minimum required withdrawal represent, and is his $50,000 withdrawal permissible?

Question: Mr. Chen is 73 years old with a RRIF valued at $400,000. He uses his own age for the minimum withdrawal calculation. Due to unexpected medical expenses, he needs to withdraw $50,000 this year. What percentage of his RRIF value would the minimum required withdrawal represent, and is his $50,000 withdrawal permissible?

Answer options: ✅ 5.4%, Yes

• 5.4%, No
• 5.7%, Yes
• 5.7%, No

Correct answer: 5.4%, Yes

Explanation: For age 73, the RRIF minimum withdrawal factor is 5.4%. So, the minimum withdrawal is $400,000 * 0.054 = $21,600. Since $50,000 is greater than $21,600, it is permissible to withdraw that amount, but the excess will be fully taxable. The minimum withdrawal factor is 5.4%, and he can withdraw more than the minimum.