Locked-In Retirement Income Vehicles Attributes
KNOWLEDGE EXPECTED OF: QAFP® Professionals
Highest Knowledge Level: Understanding
Knowledge Levels and Associated Verbs
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Awareness
The state of being aware that something exists / to have familiarity with a particular activity or subject
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Understanding
To comprehend the general relationship of particulars / to have an expertise with how something works
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Application
Ability to put information to use / to use knowledge for relevant, practical purposes
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Evaluation
To judge or conclude by utilizing data / a systematic determination of something’s worth or significance
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Define
To state exactly the meaning of
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Identify
To be aware of / to recognize and correctly name / to locate an appropriate resource
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Explain
To make clear the meaning of / to describe something in more detail or reveal relevant facts or ideas related to it
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Determine
To ascertain / to come to a decision, such as by investigation or reasoning
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Compare
To note the similarities and differences between two or more things
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Estimate
To determine an approximate value for
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Calculate
To find the value using mathematics
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Convert
To change from one form or purpose to another
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Evaluate
To reach a conclusion or make a through careful study
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Interpret
To give the meaning of / to construe or understand / to translate orally
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Hold cursor over or click on each term to read its definition.
- Define a locked-in retirement income vehicle.†
- Explain for whom a locked-in retirement income vehicle may be suitable.
- Identify the legislation relevant to a locked-in retirement income vehicle.
- Federal Income Tax Act
- Pension legislation for the jurisdiction in which the plan operates
- Identify where legislation related to locked-in retirement income vehicles may differ across jurisdictions, such as:
- Plan criteria
- Transfers
- Withdrawals
- Minimum amounts
- Maximum amounts
- Unlocking provisions
- Spousal consent requirements
- Identify the jurisdiction of a locked-in retirement vehicle.
- Explain advantages and disadvantages associated with a locked-in retirement income vehicle.
- Define the parties to a locked-in retirement income vehicle.
- Annuitant
- Beneficiary
- Issuer / Provider
- Successor annuitant
- Explain the role of each of the parties to a locked-in retirement income vehicle.
- Explain how a locked-in retirement income vehicle is funded.
- Explain how income earned within a locked-in retirement income vehicle is treated for tax purposes.
- Identify the importance of making a valid beneficiary designation.
† The term locked-in retirement income vehicle is used to denote Life Income Funds (LIF) and Restricted Life Income Funds (RLIF). The regulations required of all locked-in retirement income vehicles plans follow similar regulations across jurisdictions with variations related to each jurisdiction’s pension legislation. Unless otherwise noted, where “locked-in retirement income vehicle” is used throughout this document it may be taken to mean one of these plans or a similar vehicle that meets the requirements of a registered plan under the Federal Income Tax Act and the pension legislation of the jurisdiction in which the plan is available. Such plans may include Locked-in Retirement Income Funds (LRIF) and Prescribed Registered Retirement Income Funds (PRRIF).
KNOWLEDGE EXPECTED OF: CFP® Professionals
Highest Knowledge Level: Understanding
Knowledge Levels and Associated Verbs
|
Awareness
The state of being aware that something exists / to have familiarity with a particular activity or subject
|
Understanding
To comprehend the general relationship of particulars / to have an expertise with how something works
|
Application
Ability to put information to use / to use knowledge for relevant, practical purposes
|
Evaluation
To judge or conclude by utilizing data / a systematic determination of something’s worth or significance
|
||||||
|---|---|---|---|---|---|---|---|---|---|
|
Define
To state exactly the meaning of
|
Identify
To be aware of / to recognize and correctly name / to locate an appropriate resource
|
Explain
To make clear the meaning of / to describe something in more detail or reveal relevant facts or ideas related to it
|
Determine
To ascertain / to come to a decision, such as by investigation or reasoning
|
Compare
To note the similarities and differences between two or more things
|
Estimate
To determine an approximate value for
|
Calculate
To find the value using mathematics
|
Convert
To change from one form or purpose to another
|
Evaluate
To reach a conclusion or make a through careful study
|
Interpret
To give the meaning of / to construe or understand / to translate orally
|
Hold cursor over or click on each term to read its definition.
- Define a locked-in retirement income vehicle.†
- Explain for whom a locked-in retirement income vehicle may be suitable.
- Identify the legislation relevant to a locked-in retirement income vehicle.
- Federal Income Tax Act
- Pension legislation for the jurisdiction in which the plan operates
- Identify where legislation related to locked-in retirement income vehicles may differ across jurisdictions, such as:
- Plan criteria
- Transfers
- Withdrawals
- Minimum amounts
- Maximum amounts
- Unlocking provisions
- Spousal consent requirements
- Identify the jurisdiction of a locked-in retirement vehicle.
- Explain advantages and disadvantages associated with a locked-in retirement income vehicle.
- Define the parties to a locked-in retirement income vehicle.
- Annuitant
- Beneficiary
- Issuer / Provider
- Successor annuitant
- Explain the role of each of the parties to a locked-in retirement income vehicle.
- Explain how a locked-in retirement income vehicle is funded.
- Explain how income earned within a locked-in retirement income vehicle is treated for tax purposes.
- Identify the importance of making a valid beneficiary designation.
† The term locked-in retirement income vehicle is used to denote Life Income Funds (LIF) and Restricted Life Income Funds (RLIF). The regulations required of all locked-in retirement income vehicles plans follow similar regulations across jurisdictions with variations related to each jurisdiction’s pension legislation. Unless otherwise noted, where “locked-in retirement income vehicle” is used throughout this document it may be taken to mean one of these plans or a similar vehicle that meets the requirements of a registered plan under the Federal Income Tax Act and the pension legislation of the jurisdiction in which the plan is available. Such plans may include Locked-in Retirement Income Funds (LRIF) and Prescribed Registered Retirement Income Funds (PRRIF)
Additional Knowledge Expected of CFP Professionals
- Identify qualified investments as prescribed by the Canada Revenue Agency that may be held in a locked-in retirement income vehicle.1
- Identify non-qualified investments as prescribed by the Canada Revenue Agency that may not be held in a locked-in retirement income vehicle.2
- Explain the tax that may be imposed by the Canada Revenue Agency when a locked-in retirement income vehicle contains a non-qualified investment.3
- Identify prohibited investments as prescribed by the Canada Revenue Agency that may not be held in a locked-in retirement income vehicle.4
- Explain the tax that may be imposed by the Canada Revenue Agency when a locked-in retirement income vehicle contains a prohibited investment.5
