Get a quick and easy estimate of how much lifetime retirement income members will get from contributions to DBplus.
PortabilityWhether you are joining CAAT or leaving your job with a CAAT employer, the Plan’s portability options help you to build a bigger pension.
Leaving your job doesn’t mean giving up your valuable CAAT pension.
If you are not yet eligible, or not yet ready to start your pension, the Plan’s termination options provide both flexibility and security so you can make the best choice for your retirement income.
Automatic portability among CAAT employers
If you go to work for another employer that participates in the CAAT Pension Plan, you will continue to contribute and build your pension in your new job.
Transferring to another employer’s pension plan
If you go to work for an employer that offers a different Canadian registered pension plan than CAAT, you can transfer your CAAT pension to your new employer’s plan, provided that plan will accept the transfer and you are under age 65.
24-month extension of membership keeps portability options open
If you leave your job and don’t go to work for a CAAT Plan employer, you will stop accruing a pension, but your Plan membership will be automatically extended for 24 months from the date of your last contribution to the Plan. During this ‘extension of membership,’ your pension will continue to grow with annual increases based on the Average Industrial Wage index, a measurement of wage increases across Canada. During the extension of membership, you have portability options to move your pension to another pension plan if you start a new job.
At the end of the 24-month extension of membership period, the following options become available to you, in addition to those offered during the extension of membership period. Your age is a factor in determining the options available to you, as outlined below.
The option to choose a secure, lifetime pension
By deferring your pension, you leave it in the CAAT Plan until you reach retirement age and are ready to start collecting it. The deferred pension includes all the benefits of a regular pension plus the following valuable features:
- The option to begin your pension as early as age 50 (with an early start adjustment).
- During the deferral period, your pension continues to grow with conditional inflation protection increases.
- Inflation protection increases also apply when you start collecting your pension.
- A lifetime survivor pension for your eligible spouse on your death.
The option to transfer the commuted value
The commuted value is the amount of money that would have to be invested today, based on current interest rates, to be equivalent in today’s dollars to your future pension stream.
You must be under age 50 to choose the commuted value option. If you are under 50 at the end of your 24-month extension of membership, you have six months to choose to transfer the commuted value of your benefit out of the Plan into a locked-in retirement account. If you do not choose to transfer the commuted value, you will remain entitled to a deferred pension.
Commuted value funds must remain locked-in and they must be used for retirement income starting at age 55 at the earliest. If you take the commuted value out of the Plan, you have no further entitlement from the CAAT Plan and will be responsible for investing the funds yourself.
If your pension benefits are subject to federal jurisdiction, your spouse must provide consent prior to a commuted value transfer, in accordance with the applicable legislation.
The Income Tax Act (ITA) places a limit on the amount of commuted value that you can transfer directly to a locked-in account. If you choose this option and the ITA limit applies, you can take the excess in a lump sum which is taxed at your current marginal tax rate. If the withholding tax is too low, you will be assessed additional tax payments when you file your income tax for the year of the transfer.
Consolidate your pension
If you worked for an employer that does not participate in the CAAT Pension Plan, but that had a Canadian registered pension plan that you participated in, you may be able to make a purchase in respect of that membership, as long as the funds are in a registered retirement savings account, such as an RRSP.
The option of leaving your accrued benefits in the CAAT Plan as a deferred pension gives you the security of a future lifetime pension with inflation protection and survivor benefits.