Planning for Retirement

Most pension plans have a normal retirement date that is the first of the month that follows or is coincident with the plan member’s 65th birthday. By law, the plan’s normal retirement date or age cannot be later than 66 years of age.

The normal retirement date or age is when, under the terms of the pension plan, a plan member would normally become eligible to receive a full unreduced pension from the plan. Since each pension plan is unique, you will need to refer to your annual statements, your employee booklet, or the plan text for this information. Your pension plan must specify the normal retirement date for members of the plan. The annual statement you receive for your pension plan provides information on the pension benefits you have earned to date, as well as your early, normal and postponed retirement dates. This information can help you decide which retirement option is best for you.

Your Total Retirement Income

Your total retirement income may consist of income from a variety of sources, such as:

  • Pension benefits from your employer’s registered pension plan.
  • Canada Pension Plan (CPP) from the federal government.
  • Old Age Security (OAS) Program from the federal government.
  • Your personal retirement savings or investments, such as savings accounts, Tax-Free Savings Accounts (TFSAs), Registered Retirement Savings Plans (RRSPs), bonds, Guaranteed Investment Certificates (GICs), life annuities, etc.
  • Income from a life annuity, a Locked-in Retirement Account (LIRA), or a Life Income Fund (LIF) derived from your former employer’s pension plan. (Note that this only applies if you decided to leave your employer and transfer your pension entitlements out of your registered pension plan).
  • Other benefits you may be entitled to receive from the federal or provincial governments, such as the Guaranteed Income Supplement (GIS) and Guaranteed Annual Income System (GAINS).

Keep in mind that most of the above benefits need to be included in your taxable income.

Before you choose any particular retirement option, consider the following questions:

  1. Does your pension plan provide indexation or cost-of-living adjustments on your pension benefits to deal with inflation?
  2. Can you take advantage of an early retirement option? If so, will your pension be partially or fully reduced?
  3. Does your pension plan have a maximum limit on the amount of pension that can be earned or a maximum limit on the number of years of employment (or plan membership) that can be used to calculate your pension benefits?
  4. If you have a spouse when you retire, do you both want your spouse to waive the right to receive a survivor pension when you die?


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Please let us know how we can help. Whether it is a free no-obligation quote or just a question – we will be happy to provide you with detailed answers.

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