Can I unlock my RRSP to avoid a Consumer Proposal?
October 7th, 2013 by Questions
I am in financial trouble and I am currently reviewing filing a consumer proposal. The issue is that I have the money to pay ALL of my debts but it’s locked into a RRSP that I received from a registered pension.
I am not close to the age to unlock the funds. Is their anyway that I can get this unlocked to avoid a consumer proposal or bankruptcy.
I want to pay my debts and have the funds but the government is roadblocking me from obtaining the funds to pay off my debt. I will do anything required to unlock these funds.
What is your opinion or direction I can take? Do I have to enter a proposal or can the money be used to pay the creditors.
I would settle for direct payment from the locked funds to the creditors with the remaining balance staying locked in. I don’t necessarly need to access the funds myself.
Posted from: Ontario
One Response to “Can I unlock my RRSP to avoid a Consumer Proposal?”
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October 07, 2013 at 4:46 pm, A licensed trustee said:
It is possible to make an application to the government to release the locked in pension money under the “hardship rules”. It is not something that is normally recommended – RRSP that are locked in are exempt from seizure (that means they are protected under the law). Withdrawing the funds is certainly worth considering, but you should probably speak to a profession and review all of your options before you make any decisions. I think you will decide not to cash out the RRSPs…