The Lifelong Learning Plan

The Lifelong Learning Plan

This week we take a look at another way to use your RRSP funds. This time it’s their ability to be used as a way to fund your education at qualified educational institutions. This helpful program is called the Lifelong Learning Plan or LLP for short.

Thanks again for reading, you can read more here about the Friendly Financial Coach.

How Does the Lifelong Learning Plan work?

Thankfully, the Lifelong Learning Plan is pretty straightforward and simple to participate in. The maximum amount that can be withdrawn from your RRSPs is $10,000 a year and/or up to $20,000 over four years. This program can also be used for your spouse; for example, a wife can withdraw from her RRSPs to pay for her husband’s education.

To qualify, the student must be enrolled in a qualified educational institution and be enrolled under full-time status for at least three months of the year. Part-time status is only available for individuals that have special disabilities, preventing them from full-time enrolment.


How to Withdrawal Money Under the Lifelong Learning Plan

Once you verify that you’re eligible to enrol in the LLP program, then the process to withdraw the funds is very simple. You need to fill out form RC96 and meet with the financial institution that has your RRSPs. It’s important to make it very clear that you are withdrawing the funds under the LLP program. The funds will be transferred to your bank account within a couple business days.


Repaying Back the Funds from the Lifelong Learning Plan

Repayment begins the fifth year after the initial withdraw or the following year of non-enrolment in full-time studies. For example, if you withdrew the funds in 2013 and did not meet full-time enrolment in 2014 and 2015, then the first payment is due in 2015. Payments are made over ten years and the amount is simply the total amount withdrawn from your RRSPs divided by ten. The payments are made to your RRSPs and designated on your income tax documents.
If payments are not made or are partially made, then the outstanding balance will be added to your income and taxed accordingly. In reality, if you have a year of low income then you may have no tax consequences of not paying the amount back as your income may be too low to tax.

Thanks again for reading about the Lifelong Learning Plan and please share this article if you enjoyed it or know anyone else who can benefit. If you have any questions please contact me at or 647-289-0012. Also don’t forget to sign-up to our super awesome Newsletter!

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6 years ago

Before the downturn we pharucsed a lake front Condo. using 40,000 from RRSP to get beloww the CMHC insurance threshold. The Condo has appreciated a huge amount compared to my mutual funds. Thanks to a savy investment advisor.rod

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