Should I draw down my RRIF to avoid estate taxes?

A reader wonders whether to pull extra money out of a RRIF and move it into a regular non-registered account, hoping to soften the tax that will land on the estate at death. It sounds reasonable, but Allan generally steers away from it. The quiet advantage of leaving money inside a RRIF is that it keeps compounding without yearly tax drag, and that benefit is easy to underestimate. Cashing out early does the opposite: it triggers tax right away, exposes future growth to annual taxation, and can nudge income high enough to chip away at Old Age Security. He also points out that the tax hit at death is often smaller than the dreaded half-your-balance figure people assume. For most retirees worried about estate tax, the early-drawdown move usually costs more than it saves.