What is guaranteed income for life and should I have some?
By Reynolds Edokpayi, Zenith Advisory Inc., Saskatoon · Updated October 2026 · 4 min read
The problem it solves
Nobody knows how long retirement will last. Plan for 25 years and live 35, and the money runs out. Plan for 35 and live 25, and you under-spent for decades. Guaranteed lifetime income removes that guess for the portion of spending you can't afford to get wrong.
How it works
You convert a lump sum, often from an RRSP or RRIF at retirement, into a contract that pays a set monthly amount for life. Options include payments that continue to a spouse, and a guarantee period so that if you die early, payments continue to your estate for a minimum number of years.
Who it tends to suit
- People without a workplace pension who want pension-like certainty
- Those whose CPP and OAS don't cover essential expenses
- Anyone who finds market swings stressful in retirement
- Later starters who can't afford a bad sequence of returns early in retirement
The trade-offs
- You give up access to the lump sum
- Payments are typically fixed, so inflation erodes them unless you add indexing (which lowers the starting payment)
- If you die early without a guarantee period, the insurer keeps the balance
A common approach
Cover the essentials (housing, food, utilities, health) with guaranteed sources: CPP, OAS and a lifetime income contract. Keep the rest invested for growth and flexibility. That way the market can have a bad year and your rent is still paid.
What we do
We model your income sources against your essential and discretionary spending and show you whether, and how much, guaranteed income makes sense for you. The numbers are personal, so we don't quote them here; they come from your situation.
Want this worked out for your numbers? We'll map where you are, show the gap in dollars, and pick the accounts that save you the most tax.