Congratulations! Planning for retirement is an exciting event in your life, however, it is also a time to make some important decisions. The following information is intended to provide you with a variety of tools and products to help you choose the benefits that are right for you.
Can you increase your pensionable service prior to retirement?
You may have periods of prior service that you can buy back as a way of Increasing Your Pension. Any service buyback has to be made before you retire.
If you have not finished paying for an existing service buyback, you will have to continue making payments after you leave. For more information, refer to the Service Buyback Package.
What steps should you follow when preparing to retire?
Step 1: Take the time to familiarize yourself with your Pension Options.
Your options vary depending on your age and your years of pensionable service when you leave the federal public service.
If you have at least 2 years of pensionable service, you may be entitled to:
If you have less than 2 years of pensionable service, generally you are entitled to:
You may also be eligible to transfer all or part of your accrued pension credits to another pension plan through Pension Transfer Agreements regardless of the number of years of pensionable service that you have to your credit.
More detailed information on the retirement process, required forms, and impact on insurance benefits can be found in the Pension Entitlement Information Package.
Step 2: Find out the value of each of your pension options.
Examine your most recent personal Pension and Insurance Benefits Statement, as it provides you with a summary of your entitlements and their approximate value. The Compensation Web Applications (CWA) - Pension Calculator can also help you estimate your yearly and monthly pension based on the information you enter.
The public service also offers several Retirement Courses which cover subjects such as: financial planning, the public service pension plan, legal aspects of retirement, health and emotional issues.
Also available, the You and Your Pension Plan video series, based on the half-day retirement courses. They offer you the opportunity to learn more about specific pension and group benefit topics that are important to you with unlimited access to the videos anytime, anywhere.
Step 3: Find out which of your insurance benefit plans continue after retirement
Accidental Death and Dismemberment (AD & D) and Long-term Disability (LTD) insurances under the PSMIP cannot be converted to private policies, and terminate on the day you leave the public service.
Step 4: Estimate what your financial requirements will be when you leave the public service.
Consult the Understanding Your Financial Needs section for additional information.
Once you have chosen your retirement date, who should you notify?
You must notify your compensation advisor and the Government of Canada Pension Centre once you have chosen your retirement date. This should be done at least 3 months in advance of your retirement date.
How do you choose a pension benefit option?
When you inform the Pension Centre of your retirement date, they will provide you with a Pension Benefit Options Statement which you must complete in order to choose your benefit option. Detailed information on the retirement process, required forms, and impact on insurance benefits can be found in the Pension Entitlement Information Package.
Why does your bridge benefit under the public service pension plan stop at age 65?
The bridge benefit portion of your public service pension will stop when you reach 65 or earlier if you begin to receive Canada or Quebec Pension Plan (CPP/QPP) disability benefits. This is due to the Canada Pension Plan/Quebec Pension Plan Coordination of contributions and benefits.
Is your pension benefit protected from inflation?
Yes. Your pension will be protected from losing its value as a result of inflation (increases in the cost of living) through Protection from Inflation for the rest of your life, unless you become re-employed and a contributor to the public service pension plan. This protection is referred to as the annual pension increase (indexing).
Does your retirement date affect the pension increases (indexing) you receive?
The Public Service Superannuation Act (PSSA) provides for annual increases, based on increases in the Consumer Price Index (CPI), on all retirement and survivor benefits. The increases usually begin January 1 following the year of retirement and are effective each year after that.
The first indexing amount will be prorated to reflect the number of full months remaining in the year following the month in which you retired. In subsequent years, you will be entitled to the full increase.
Example: If an employee retires on August 20, in January of the following he would be entitled to a pension indexing increase of 4/12 (for September to December).
What happens if you have not finished paying your pension contributions or benefit premiums for your period of leave without pay when you retire?
Any pension and Supplementary Death Benefit contributions still owing for a period of leave without pay have to be paid when you retire. Information on payment options for these contributions can be found in the Pension Entitlement Information Package - Two or More Years of Pensionable Service.
Any insurance benefit premiums or contributions still owing for a period of leave without pay have to be paid when you retire. Contact your compensation advisor for further information.
If you have granted someone a general Power of Attorney, can that person manage your pension affairs?
If you wish for another person to manage some of your pension affairs, an original, notarized, or a certified true copy of the general Power Of Attorney (POA) document bearing the original signature of the lawyer, notary, commissioner of oaths or justice of the peace must be sent to the Government of Canada Pension Centre. The person you name can then request address changes, direct deposit and choose a benefit on your behalf. However, a POA does not provide that person with the authority to change the recipient of a pension benefit or to change a beneficiary under the Supplementary Death Benefit Plan.
In order to protect our plan members, the Pension Centre cannot accept photocopies, faxes or scans of legal documents. Original POA documents will be returned to you by mail.
If you simply wish to allow someone to make enquiries and receive information about your pension matters, but not make decisions on your behalf, you can provide the Pension Centre with a written consent to that effect.