Skip to the content

Planning for retirement

When you retire, you collect a pension every month for the rest of your life. In the CAAT Plan, retirement dates are flexible, so you can retire when the time is right for you. Plus, your pension includes valuable extra benefits: inflation protection and survivor benefits. These benefits help protect the purchasing power of your pension, and provide peace of mind.

We’re here to help you get ready for retirement. Before the date approaches, be sure to review the process, to make your transition to retirement a smooth one.

How much will your pension be?

Your DBplus pension is calculated using a formula, so you know what your annual pension will be when you retire. Each year you'll receive a Member Statement, showing the pension you have accumulated to the end of the previous year.

For more information on how the DBplus pension formula works, click below.

Planning for retirement

When you retire, you collect a pension every month for the rest of your life. In the CAAT Plan, retirement dates are flexible, so you can retire when the time is right for you. Plus, your pension includes valuable extra benefits: inflation protection and survivor benefits. These benefits help protect the purchasing power of your pension, and provide peace of mind.

We’re here to help you get ready for retirement. Before the date approaches, be sure to review the process, to make your transition to retirement a smooth one.

How much will your pension be?

Your DBplus pension is calculated using a formula, so you know what your annual pension will be when you retire. Each year you'll receive a Member Statement, showing the pension you have accumulated to the end of the previous year.

For more information on how the DBplus pension formula works, click below.

The pension formula is divided into two components:

  • Guaranteed annual base pension (payable from age 65) – calculated at the end of each year, and 
  • AIW Enhancements – applied at the start of each year.

1. Guaranteed annual base pension

  • The promised pension earned in the current year, calculated at the end of each year you contribute, using your total contributions, and your employer's matching contributions. The formula uses a pension factor as a multiplier to calculate your pension. It is set based on the Plan’s Funding Policy and is currently 8.5%.

8.5% x year’s total contributions* = your guaranteed base pension

*Note that the year’s total contributions are the member's plus your employer’s contributions, doubling the value of your pension.

2. AIW Enhancement

  • This is the amount added to the previous year’s total promised pension. It is applied at the start of each year in which you are a contributing member, subject to the Plan's Funding Policy and is based on the announced increase to the Average Industrial Wage (AIW) index.
  • The AIW index represents wage inflation in Canada. The Average Industrial Wage (AIW) enhancement paid to pensions on January 1, 2002, for pensions members earned in DBplus in 2019 was 2.25%.
  • AIW Enhancements, once added, become a permanent part of your promised pension. That means that the AIW Enhancements are cumulative – each year’s enhancement is paid on top of the previous year’s total pension, plus enhancements.

DBplus past promised benefits**  x  AIW Enhancement rate

**Past promised benefits accrued to the end of the previous year, including any past AIW Enhancements.

Estimate your pension

Simply enter some basic data and let the Pension Estimator show you your projected retirement dates and estimated pension amounts. With the Pension Estimator, you can model any retirement scenario you like.

When can you retire?

Under DBplus, you can retire and start collecting your unreduced pension at age 65, or retire as early as age 50, with a reduction. The reduction rate varies from 3% to 5% based on the Plan’s funding level. Initially, the reduction rate for retirements has been set to 3% for each year you are under age 65. The actual rate will depend on the Plan terms in effect at your retirement.

Your pension continues to grow if you keep working after age 65.

Your pension includes valuable additional benefits

Your CAAT Plan pension includes valuable extra benefits: inflation protection and survivor benefits. These benefits help protect the purchasing power of your pension, and provide peace of mind.

Inflation protection

  • Your pension includes conditional inflation protection, which is calculated based on changes to the previous year’s Consumer Price Index (CPI).
  • Inflation protection, when it is granted, is added to your pension on January 1. This new amount becomes your new lifetime pension. As a result, each year’s inflation protection increase is applied to your previous inflation protection, as well as your pension.
  • Inflation protection increases are conditional on the Plan’s funded status, granted when the Plan is fully funded. Since being introduced, conditional inflation protection has always been paid. Increases have been granted until at least January 1, 2023.

How is the increase calculated?

Inflation protection increases are based on 75% of the CPI up to a maximum of 8%. In recent years, when inflation has been low, the increase has rarely risen above 2%. If there is no increase in the CPI of a given year, there would be no increase to pensions in the following year.

Survivor benefits

  • Your pension includes a lifetime pension for your surviving eligible spouse, equal to 60% of the lifetime pension you were receiving at the date of your death. The survivor pension receives inflation protection in the same manner as your lifetime pension did.
  • If you have an eligible spouse when you retire, you will have the option to choose either the default 60% survivor pension, or a 75% survivor pension. If you choose the 75% survivor pension option, your lifetime pension will be actuarially reduced to reflect the cost of the higher survivor pension, and that reduction is permanent.
  • If you do not have an eligible spouse when you retire, but subsequently have one in retirement, that spouse can receive the 60% survivor pension.

Under rare circumstances, your designated beneficiary may receive a payment upon your death. This payment would occur if you were to die early in your retirement, and only if you have no eligible spouse or eligible children (under age 18).

In that case, if the total amount of pension paid out to you is less than 60 times your original monthly lifetime payment, any difference would be paid in a lump sum to your beneficiary (or your estate if you do not designate a beneficiary). This provision does not apply after you have been receiving your pension for 60 months. (Note that if your jurisdiction of employment at retirement was Quebec you would have had the option to select a guarantee period of 120 months.)

Ensure a smooth transition to retirement

When you're ready, contact your employer HR to get the retirement process started.

Avoid delays in starting your pension

Marital separation and divorce is the number one cause of delayed pension starts. If you separated or divorced during your membership, contact the Plan to find out what you need to do before we can process your pension.

Not providing proof of age (and your Spouse’s, if applicable) can delay your pension. Acceptable proof of age includes any government issued identification (federal or provincial) that clearly shows the card holder’s date of birth, excluding health cards, (e.g. passport, birth certificate, citizenship card, driver’s license). Remember: payment will not be made unless proof of age is provided.

Starting your government pensions

You can start your CPP or QPP pension any time after age 60, and your OAS when you turn 65. Be sure to apply for these benefits at least six months before you want to start collecting them.

For more information visit Canada.ca, or call 1-800-O-CANADA.

Securely transmit your documents to CAAT

Use the CAAT Pension Plan’s Secure Document Online Courier, "S-Doc," to share files such as signed Option Documents securely with the CAAT Pension Plan while protecting your personal and confidential information. 

Contact Us Image

Questions? Contact Us

The CAAT Plan's member services team are available to answer any questions you may have.