police and firefighter retirement seminar

Police and Firefighter Retirement Seminar

Reg. T.M. Municipal Pension Board of Trustees

Retirement SeminarRetirement Seminar

2004-029 MPP 2006.10.20 NRA60

AgendaAgenda

• AdministrationAdministration

• Basics of the Municipal Pension PlanBasics of the Municipal Pension Plan

• Pension formulaPension formula

• Special Agreement contributionsSpecial Agreement contributions

• Pension optionsPension options

• Other factors that affect your pensionOther factors that affect your pension

• Increasing pensionable serviceIncreasing pensionable service

• Retirement processRetirement process

• After retirementAfter retirement

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2004-029 MPP 2006.10.20 NRA60

Municipal Pension PlanMunicipal Pension Plan

Governed by:Governed by:

• Municipal Pension Plan Joint Trust AgreementMunicipal Pension Plan Joint Trust Agreement

• Municipal Pension Plan RulesMunicipal Pension Plan Rules

• Municipal Pension Board of Trustees, composed Municipal Pension Board of Trustees, composed of employer and employee representativesof employer and employee representatives

Administered by:Administered by:

• The BC Pension CorporationThe BC Pension Corporation

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2004-029 MPP 2006.10.20 NRA60

Web ServicesWeb Services

Visit our website for plan informationVisit our website for plan information

mpp.pensionsbc.campp.pensionsbc.caAccess Access My AccountMy Account for: for:

• a copy of your a copy of your Member’s Benefit StatementMember’s Benefit Statement

• online pension estimatoronline pension estimator

• online purchase cost estimatoronline purchase cost estimator

• view your account informationview your account information

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2004-029 MPP 2006.10.20 NRA60

BasicsBasics

• The Municipal Pension Plan The Municipal Pension Plan is a defined is a defined benefit plan. benefit plan.

• Your personal contributions do not affect Your personal contributions do not affect your final benefityour final benefit

• A formula determines your pension benefit:A formula determines your pension benefit: AgeAge SalarySalary Pensionable servicePensionable service

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2004-029 MPP 2006.10.20 NRA60

BasicsBasicsAgeAge• Normal retirement age 60Normal retirement age 60• Earliest retirement age 50Earliest retirement age 50

SalarySalary• Highest Average Salary (HAS)Highest Average Salary (HAS)

ServiceService• Contributory service determines eligibility and Contributory service determines eligibility and

reductionsreductions• Pensionable service determines benefits ($)Pensionable service determines benefits ($)

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2004-029 MPP 2006.10.20 NRA60

Unreduced PensionUnreduced Pension• Age 50 to 55 and your age plus contributory Age 50 to 55 and your age plus contributory

service totals 80 or moreservice totals 80 or more

• Age 55 or older with two years or more of Age 55 or older with two years or more of contributory servicecontributory service

Reduced PensionReduced Pension

• pension is subject to a reduction if pension is subject to a reduction if either of the above tests are not meteither of the above tests are not met

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2004-029 MPP 2006.10.20 NRA60

AgeAge 51 years 2 months51 years 2 months

ServiceService 28 years 10 months28 years 10 months

TotalTotal 79 years 12 months 79 years 12 months

== 80 80

= = Unreduced Unreduced pensionpension

Example of Rule of 80Example of Rule of 80

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2004-029 MPP 2006.10.20 NRA60

3% Reduction Factor3% Reduction Factor

• Terminate at age 45 to 50, with 10 years or Terminate at age 45 to 50, with 10 years or more of contributory servicemore of contributory service

• Terminate at age 50 or later and vestedTerminate at age 50 or later and vested

• Calculated from lesser of 80 or age 55Calculated from lesser of 80 or age 55

• Maximum reduction is 15%Maximum reduction is 15%

Otherwise, the reduction is 5% per year to a maximum of 25%

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2004-029 MPP 2006.10.20 NRA60

Example of a Reduced PensionExample of a Reduced Pension

• Terminated employment May 31, 2007 at age 54Terminated employment May 31, 2007 at age 54with 23 years of contributory servicewith 23 years of contributory service

• Immediate pensionImmediate pension

• Reduction in pension:Reduction in pension:

Lesser is 2Lesser is 2Reduction is 3% Reduction is 3% xx 2 2 == 6% 6%

23 23 ++ 53 53 == 76 7680 80 -- 76 76 == 4 455 55 -- 53 53 = = 22

A $3,000 pension is reduced to $2,820 (without SA)

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2004-029 MPP 2006.10.20 NRA60

8080 70%70%Age and Service Affect Your PensionAge and Service Affect Your Pension

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2004-029 MPP 2006.10.20 NRA60

Pension FormulaPension Formula

$

A.A. Pension Formula to age 65Pension Formula to age 65

=B.B. MinusMinus Bridge Benefit at age 65 Bridge Benefit at age 65

$=

$=Your monthly unreduced lifetime Your monthly unreduced lifetime pension (pension (A - BA - B) from age 65) from age 65

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2004-029 MPP 2006.10.20 NRA60

2%2%(0.02)(0.02)

5-year 5-year Highest Highest AverageAverageSalarySalary

(monthly)(monthly)

xxYears of Years of

PensionablePensionableServiceService

xx $$

A.A. The Pension FormulaThe Pension Formula

Your basic monthly pension is calculated in two steps:Your basic monthly pension is calculated in two steps:

==

Minus ...Minus ...


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2004-029 MPP 2006.10.20 NRA60


B.B. The Bridge BenefitThe Bridge Benefit

YMPE YMPE == Year’s Maximum Pensionable Earnings. Used in the Year’s Maximum Pensionable Earnings. Used in the determination of your Canada Pension Plan, and is updated determination of your Canada Pension Plan, and is updated annually to reflect the national average industrial wage. The annually to reflect the national average industrial wage. The YMPE for 2007 is $43,700 ($3,642 monthly).YMPE for 2007 is $43,700 ($3,642 monthly).

0.7%0.7%(0.007)(0.007)

Lesser ofLesser of5-year Highest 5-year Highest Average SalaryAverage Salary

or YMPEor YMPE(monthly)(monthly)

xxYears of Years of

PensionablePensionableServiceService

xx $$==

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2004-029 MPP 2006.10.20 NRA60

Calculating Highest Average SalaryCalculating Highest Average Salary

YearYear

20082008

20072007

20062006

20052005

20042004

20032003

PensionablePensionable ServiceService

7.007.00

12.0012.00

12.0012.00

12.0012.00

12.0012.00

5.005.00

60.00 months60.00 months

SalarySalary

$45,966$45,966

$78,783$78,783

$79,086$79,086

$79,639$79,639

$67,314$67,314

$27,812$27,812

$378,600$378,600

HAS HAS == 378,600 / 60 378,600 / 60 == $6,310 per month $6,310 per month

Avg.Avg. SalarySalary

$6,567$6,567

$6,565$6,565

$6,591$6,591

$6,636$6,636

$5,609$5,609

$5,562$5,562

$6,310$6,310

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2004-029 MPP 2006.10.20 NRA60

Pension Formula ExamplePension Formula Example

Plan member and spouse are both 54Plan member and spouse are both 54

Retirement dateRetirement date December 31December 31

Pension effective datePension effective date January 1January 1

Pensionable servicePensionable service 28 years28 years

Contributory serviceContributory service 29 years29 years

HASHAS $6,310$6,310

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2004-029 MPP 2006.10.20 NRA60

Pension Formula ExamplePension Formula Example

Basic monthly pension to age 65 Basic monthly pension to age 65

2%2% x x $6,310 $6,310 xx 28 28 == $3,537 $3,537

Minus the bridge benefitMinus the bridge benefit

0.7% 0.7% xx $3,642 (YMPE) $3,642 (YMPE) xx 28 28 == $714 $714

For a lifetime pension after age 65 of $2,823 per monthFor a lifetime pension after age 65 of $2,823 per month

Age: 54 Age + Contributory Service = 83 Age: 54 Age + Contributory Service = 83

NO REDUCTIONNO REDUCTION

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2004-029 MPP 2006.10.20 NRA60

Special Agreement ContributionsSpecial Agreement Contributions

• What are they?What are they?

• How are they treated at retirement?How are they treated at retirement?

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2004-029 MPP 2006.10.20 NRA60


• Simple calculations allow you to estimate the Simple calculations allow you to estimate the increase to your pension that special increase to your pension that special agreement contributions will makeagreement contributions will make

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2004-029 MPP 2006.10.20 NRA60

Subtract your age in years and months Subtract your age in years and months from your retirement datefrom your retirement date

2007 122007 12 Retirement date (Dec 2007)Retirement date (Dec 2007)1953 121953 12 Date of birth (Dec 1953)Date of birth (Dec 1953)

54 054 0 AgeAge--


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2004-029 MPP 2006.10.20 NRA60

Value of a Single Life Pension of $1 per monthValue of a Single Life Pension of $1 per monthfrom SA contributionsfrom SA contributions

Age

5051525354

555657585960

Factor212.5209.2205.7202.2198.6

194.9191.2187.3183.3179.3175.1

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2004-029 MPP 2006.10.20 NRA60


Divide your SA contributions plus interest by the rate:Divide your SA contributions plus interest by the rate:

ExampleExample

Special agreement contributionsSpecial agreement contributions $55,012$55,012

Interest on SA contributionsInterest on SA contributions ++ $125,118$125,118

Total Total $180,130$180,130

$180,130 $180,130 198.6 198.6 == $907 extra per month for life with $907 extra per month for life with a single life pension.a single life pension.

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2004-029 MPP 2006.10.20 NRA60


Add this dollar figure to the single life pension Add this dollar figure to the single life pension amount calculated using the defined benefit amount calculated using the defined benefit formula. The total is then converted to the formula. The total is then converted to the various pension options.various pension options.

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2004-029 MPP 2006.10.20 NRA60

Pension OptionsPension Options

• Single life no guaranteeSingle life no guarantee

• Single life guaranteed 5, 10 or 15 yearsSingle life guaranteed 5, 10 or 15 years

• 100% joint life100% joint life

• 60% joint life guaranteed 10 years60% joint life guaranteed 10 years

• Temporary annuity – can only be taken as part Temporary annuity – can only be taken as part of one of the above options—seek financial of one of the above options—seek financial advice before electingadvice before electing

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Single life pension Single life pension

guaranteed 10 yearsguaranteed 10 years



100% joint life + 100% joint life +

temporary annuitytemporary annuity

100% joint life 100% joint life

pensionpension



Single life guaranteed Single life guaranteed

5 yrs. + temp. annuity5 yrs. + temp. annuity

11

22

33

55

66

77

44

Temp. Temp.

AnnuityAnnuityPension Pension

after 65after 65Pension Pension

to age 65to age 65

Bridge Bridge

BenefitBenefitBasic Basic

PensionPensionOptionOption Monthly Pension Monthly Pension

OptionOption

Survivor’s Survivor’s

PensionPension

$3,283$3,283$714$714 $1,541$1,541

$3,435$3,435$490$490$714$714 $2,231$2,231

$3,781$3,781$490$490$714$714

$3,477$3,477$714$714

$3,153$3,153$714$714 $2,439$2,439

$2,569$2,569

$2,231$2,231

$2,577$2,577

$2,763$2,763

$2,439$2,439

$2,799$2,799 $3,513$3,513$714$714


guaranteed 5 yearsguaranteed 5 years$3,531$3,531$714$714$2,817$2,817 $2,817$2,817

$2,569$2,569

$2,231$2,231

$2,577$2,577

$2,763$2,763

$2,439$2,439

$2,799$2,799


no guaranteeno guarantee$3,537$3,537$714$714$2,823$2,823 $2,823$2,823

88

Sample Pension OptionsSample Pension OptionsNot Including Special Agreement Balance Not Including Special Agreement Balance

((Entitled to pension and transfer of Special Agreement balance - $180,130)Entitled to pension and transfer of Special Agreement balance - $180,130)

25

2004-029 MPP 2007.08.31 NRA60





100% joint life + 100% joint life +

temporary annuitytemporary annuity


pensionpension



Single life guaranteed Single life guaranteed

5 yrs. + temp. annuity5 yrs. + temp. annuity

11

22

33

55

66

77

44

Temp. Temp.

AnnuityAnnuityPension Pension

after 65after 65Pension Pension

to age 65to age 65

Bridge Bridge

BenefitBenefitBasic Basic

PensionPensionOptionOption Monthly Pension Monthly Pension

OptionOption

Survivor’s Survivor’s

PensionPension

$4,109$4,109$714$714 $2,037$2,037

$4,219$4,219$490$490$714$714 $3,015$3,015

$4,687$4,687$490$490$714$714

$4,366$4,366$714$714

$3,937$3,937$714$714 $3,223$3,223

$3,395$3,395

$3,015$3,015

$3,483$3,483

$3,652$3,652

$3,223$3,223

$3,699$3,699 $4,413$4,413$714$714


guaranteed 5 yearsguaranteed 5 years$4,437$4,437$714$714$3,723$3,723 $3,723$3,723

$3,395$3,395

$3,015$3,015

$3,483$3,483

$3,652$3,652

$3,223$3,223

$3,699$3,699


no guaranteeno guarantee$4,,444$4,,444$714$714$3,730$3,730 $3,730$3,730

88

Sample Pension OptionsSample Pension OptionsIncluding Special Agreement BalanceIncluding Special Agreement Balance

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2004-029 MPP 2007.08.31 NRA60

Gross Retirement Income by AgeGross Retirement Income by Age

6060 6565RetirementRetirement

Lifetime PensionLifetime Pension

Bridge BenefitBridge Benefit Old Age SecurityOld Age Security

Canada Canada Pension PlanPension Plan


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2004-029 MPP 2007.08.31 NRA60

Gross Retirement Income by AgeGross Retirement Income by Age– – With Temporary Annuity –With Temporary Annuity –

6060 6565RetirementRetirement

Lifetime Pension Lifetime Pension (reduced forever by temporary annuity)(reduced forever by temporary annuity)

Bridge BenefitBridge Benefit Old Age SecurityOld Age Security



Temporary AnnuityTemporary Annuity

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2004-029 MPP 2006.10.20 NRA60

What should I think about when What should I think about when selecting my Pension Option?selecting my Pension Option?

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2004-029 MPP 2006.10.20 NRA60

Life TablesLife Tables

Age

50

55

60

Male

81.97

82.50

83.18

Female

86.37

86.66

87.05

MPP Life

Male

79.23

79.89

80.75

Female

83.70

84.14

84.77

BC LifeCanadian Life

Male

78.26

78.91

79.81

Female

82.94

83.40

84.06

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2004-029 MPP 2006.10.20 NRA60

Other Factors That Affect Your PensionOther Factors That Affect Your Pension

• Whether you have a spouse or former Whether you have a spouse or former spouse with an entitlement to part of your spouse with an entitlement to part of your pensionpension

• When you elect to commence your pensionWhen you elect to commence your pension

• Increasing pensionable service by Increasing pensionable service by purchasing servicepurchasing service

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2004-029 MPP 2006.10.20 NRA60

Definition of SpouseDefinition of Spouse

• The person you are legally married to and, for the The person you are legally married to and, for the two-year period immediately before the relevant time two-year period immediately before the relevant time (e.g., retirement or death), were not living separate (e.g., retirement or death), were not living separate from; or, if this does not apply,from; or, if this does not apply,

• The person, of the same or opposite sex, who has The person, of the same or opposite sex, who has lived with you in a marriage-like relationship for the lived with you in a marriage-like relationship for the two-year period immediately before the relevant time.two-year period immediately before the relevant time.

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2004-029 MPP 2006.10.20 NRA60

Marital BreakdownMarital Breakdown

• We are required to administer a pension in We are required to administer a pension in accordance with any separation agreement, accordance with any separation agreement, court order or application for division of pensioncourt order or application for division of pension

• We can split the pension benefits at the sourceWe can split the pension benefits at the source

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2004-029 MPP 2006.10.20 NRA60

Deferred PensionDeferred Pension

• Vested plan members can leave work before age Vested plan members can leave work before age 50 and defer their pensions to age 50 or older50 and defer their pensions to age 50 or older

• Seek professional advice if you plan to defer your Seek professional advice if you plan to defer your pension beyond earliest eligibilitypension beyond earliest eligibility

• Your highest average salary is indexed at the same Your highest average salary is indexed at the same rate as the indexing granted to pensioners each rate as the indexing granted to pensioners each JanuaryJanuary

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2004-029 MPP 2006.10.20 NRA60

Your Pension – Take It At 50 or Defer to Age 55?Your Pension – Take It At 50 or Defer to Age 55?

If you terminate employment at age 50If you terminate employment at age 50

Monthly pension income at 50Monthly pension income at 50 $3,000$3,000

Total payments from age 50 to 55Total payments from age 50 to 55 $180,000$180,000

Unreduced pension deferred to 55Unreduced pension deferred to 55 $3,500$3,500

Increase to pensionIncrease to pension $500$500

Make-up time ($180,000 Make-up time ($180,000 ÷ ÷ $500) $500) == 360 months, or 360 months, or 30 years30 years

Age at break-even pointAge at break-even point 858535


2004-029 MPP 2006.10.20 NRA60

Disability Pension ProvisionsDisability Pension Provisions

If you are not eligible for LTD benefits, you may be eligible If you are not eligible for LTD benefits, you may be eligible for a disability pension provided you:for a disability pension provided you:

• terminate employmentterminate employment

• are under age 55 are under age 55

• have at least two years of contributory service, and have at least two years of contributory service, and

• are unable to fill any position your employer can are unable to fill any position your employer can reasonably offerreasonably offer

There is a two-year limit from the date of last contribution There is a two-year limit from the date of last contribution or service credit to applyor service credit to apply

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2004-029 MPP 2006.10.20 NRA60

Death Before RetirementDeath Before Retirement

Vested with no spouse: Vested with no spouse: commuted value (CV) payment commuted value (CV) payment to nominated beneficiary or estateto nominated beneficiary or estate

Vested with spouse: Vested with spouse:

• If member dies before 50, immediate pension or CV If member dies before 50, immediate pension or CV

• If member dies at 50 or older, immediate pension paid. If member dies at 50 or older, immediate pension paid. SA portion can be taken as a pension or CV.SA portion can be taken as a pension or CV.

Not vested: Not vested: contributions plus interest paid to spouse, contributions plus interest paid to spouse, nominated beneficiary or estatenominated beneficiary or estate

37


2004-029 MPP 2006.10.20 NRA60

Purchasing ServicePurchasing Service

• Rules for calculating most purchase types have Rules for calculating most purchase types have been simplifiedbeen simplified

• Online purchase estimator available at Online purchase estimator available at mpp.pensionsbc.campp.pensionsbc.ca

• Your employer must complete your purchase Your employer must complete your purchase applicationapplication

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2004-029 MPP 2006.10.20 NRA60

Purchasing ServicePurchasing Service

• Increases your pension benefit and may reduce Increases your pension benefit and may reduce any early retirement reductionany early retirement reduction

• May increase the subsidy for health benefitsMay increase the subsidy for health benefits

• You can pay by cheque or RRSP transfer, as You can pay by cheque or RRSP transfer, as determined by CRAdetermined by CRA

• Purchases must be made within applicable time Purchases must be made within applicable time lineslines

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2004-029 MPP 2006.10.20 NRA60

• Arrears Arrears – should have contributed, but did not– should have contributed, but did not

• Leave of absence Leave of absence – partial or unpaid leave – partial or unpaid leave

• Non-contributoryNon-contributory – did not contribute – did not contribute

• Reinstate a refundReinstate a refund – repay funds withdrawn from – repay funds withdrawn from the plan, plus interestthe plan, plus interest

Purchasing Service – TypesPurchasing Service – Types

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2004-029 MPP 2006.10.20 NRA60

For most purchases, the costing method is For most purchases, the costing method is the same (arrears, leaves, non-contributory)the same (arrears, leaves, non-contributory)

CurrentCurrentMonthly Monthly Full-time Full-time SalarySalary

Current Employer Current Employer and Employee and Employee

Contribution RatesContribution Ratesxx

Purchasing Service – CostPurchasing Service – Cost

Number of Number of Months to be Months to be PurchasedPurchased

xx

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2004-029 MPP 2006.10.20 NRA60

Purchasing Service – DeadlinesPurchasing Service – Deadlines

• You must be an active Municipal Pension You must be an active Municipal Pension Plan member to purchase service.Plan member to purchase service.

• There is a five year window of opportunity to There is a five year window of opportunity to purchase service. purchase service.

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2004-029 MPP 2006.10.20 NRA60

Is It Worth Purchasing Service?Is It Worth Purchasing Service?

• Cost-benefit analysisCost-benefit analysis

• Divide cost by the increase to pension Divide cost by the increase to pension to get number of months to break evento get number of months to break even

• Tools: Tools: Purchase estimatorPurchase estimator Pension estimatorPension estimator

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2004-029 MPP 2006.10.20 NRA60

Purchase Cost/Benefit ExamplePurchase Cost/Benefit Example

• Estimated cost to purchase three months of Estimated cost to purchase three months of service is $2,700 (based on current monthly service is $2,700 (based on current monthly salary of $6,000)salary of $6,000)

• Approximate increase to pension $30 per month Approximate increase to pension $30 per month to age 65, reducing to $24 per month at age 65to age 65, reducing to $24 per month at age 65

• $2700 $2700 ÷÷ $30 $30 == 90 months, or 7.5 years to regain 90 months, or 7.5 years to regain the costthe cost

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2004-029 MPP 2006.10.20 NRA60

Child-rearing time – Contributory Service creditChild-rearing time – Contributory Service credit

• You may be able to count time at home raising a You may be able to count time at home raising a child as child as contributory servicecontributory service for eligibility for an for eligibility for an unreduced pensionunreduced pension

• You can apply for a maximum of five years in totalYou can apply for a maximum of five years in total

• Pensionable service must be credited before and Pensionable service must be credited before and after the child-rearing periodafter the child-rearing period

• There is no cost for child-rearing creditThere is no cost for child-rearing credit

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2004-029 MPP 2006.10.20 NRA60

Portability means carrying certain pension rights from Portability means carrying certain pension rights from one pension plan to another. May include:one pension plan to another. May include:

• Public Sector Transfer AgreementPublic Sector Transfer Agreement

• Reciprocal agreements with some pension plans Reciprocal agreements with some pension plans in Canadain Canada

You must have left your contributions on deposit with You must have left your contributions on deposit with the prior plan, or reinstated service. Some agreements the prior plan, or reinstated service. Some agreements have application deadlines. Shortfalls in service are have application deadlines. Shortfalls in service are common with many reciprocal agreements.common with many reciprocal agreements.

PortabilityPortability

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2004-029 MPP 2006.10.20 NRA60

Planning For RetirementPlanning For Retirement

• About a year before you plan to retire, estimate About a year before you plan to retire, estimate your pension online at your pension online at mpp.pensionsbc.campp.pensionsbc.ca, or , or

• Request a Retirement Planning Package from Request a Retirement Planning Package from us (also available online at us (also available online at mpp.pensionsbc.campp.pensionsbc.ca))

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2004-029 MPP 2006.10.20 NRA60

Preparing To RetirePreparing To Retire

• Complete an Complete an Estimate RequestEstimate Request form form (available online) and return it to us(available online) and return it to us

• Request a Request a Pension EstimatePension Estimate by by telephonetelephone

• We will send you a We will send you a Retirement Retirement Application PackageApplication Package

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2004-029 MPP 2006.10.20 NRA60

When actually retiring:When actually retiring:

• Complete and return the Complete and return the Retirement Retirement Application PackageApplication Package

• Enclose Enclose clear copiesclear copies of proof of age of proof of age documentsdocuments

Applying To RetireApplying To Retire

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2004-029 MPP 2006.10.20 NRA60

Pension Effective DatePension Effective Date

Your pension is effective the latest of:Your pension is effective the latest of:

• first day of the month following eligibilityfirst day of the month following eligibility

• first day of the month following your final paid dayfirst day of the month following your final paid day

• first day of the month of applicationfirst day of the month of application

50


2004-029 MPP 2006.10.20 NRA60

Finalize Your PensionFinalize Your Pension

• You will receive a letter stating the exact amount of your You will receive a letter stating the exact amount of your monthly pension monthly pension

• You have 60 days to change your pension option You have 60 days to change your pension option (you must notify us in writing); otherwise, it cannot (you must notify us in writing); otherwise, it cannot be changedbe changed

• We will notify you when your pension amount changes We will notify you when your pension amount changes (income tax changes, indexing, etc.)(income tax changes, indexing, etc.)

• Notify Municipal Pension Services in writing if Notify Municipal Pension Services in writing if you moveyou move

51


2004-029 MPP 2006.10.20 NRA60

After RetirementAfter Retirement

52


2004-029 MPP 2006.10.20 NRA60

IndexingIndexing

• Effective January 1 following start of the pensionEffective January 1 following start of the pension

• Pro-rated for pensions in effect less than one yearPro-rated for pensions in effect less than one year

Indexing is not guaranteedIndexing is not guaranteed

53


2004-029 MPP 2006.10.20 NRA60

Medical, Extended Health and Dental BenefitsMedical, Extended Health and Dental Benefits

BC Medical Services Plan (MSP)BC Medical Services Plan (MSP)

• Basic medical insuranceBasic medical insurance

Pacific Blue CrossPacific Blue Cross

• Extended health benefits (EHB) planExtended health benefits (EHB) plan

• Dental benefits planDental benefits plan

Group benefit coverage is not guaranteedGroup benefit coverage is not guaranteed

54


2004-029 MPP 2006.10.20 NRA60

• You must be a Canadian residentYou must be a Canadian resident

• Coverage can include spouse and dependantsCoverage can include spouse and dependants

• BC residents may enrol in MSP at any timeBC residents may enrol in MSP at any time

• You may enrol in the EHB/dental plans at retirement You may enrol in the EHB/dental plans at retirement or later, if you can prove continuous, comparable or later, if you can prove continuous, comparable coveragecoverage

• Premiums are normally deducted from your pensionPremiums are normally deducted from your pension

Medical, Extended Health and Dental BenefitsMedical, Extended Health and Dental Benefits

55


2004-029 MPP 2006.10.20 NRA60

Re-employment of a Retired MemberRe-employment of a Retired Member

Contact us if you become re-employed with an Contact us if you become re-employed with an MPP employer. You can:MPP employer. You can:

• Continue to receive your pension, in which Continue to receive your pension, in which case you are not eligible to contribute, orcase you are not eligible to contribute, or

• Stop receiving your pension and begin Stop receiving your pension and begin accruing service, oraccruing service, or

• Stop receiving your pension, repay your Stop receiving your pension, repay your pension plus interest, and begin accruing pension plus interest, and begin accruing serviceservice

56


2004-029 MPP 2006.10.20 NRA60

Federal Pension PlansFederal Pension Plans

• Canada Pension PlanCanada Pension Plan

• Old Age Security Old Age Security

Apply six months before you want to start Apply six months before you want to start collecting either of these benefits by calling collecting either of these benefits by calling

1 800 277-99141 800 277-9914

or visit or visit

www.servicecanada.gc.cawww.servicecanada.gc.ca

57


2004-029 MPP 2006.10.20 NRA60

Canada Pension PlanCanada Pension Plan

• Contributions paid by employees and employersContributions paid by employees and employers

• Normal age for retirement benefits is 65, even if Normal age for retirement benefits is 65, even if you are still at work you are still at work

• Reduced pension benefits available as early as Reduced pension benefits available as early as age 60, subject to criteria being metage 60, subject to criteria being met

Reduction 6% a year to a maximum of 30%Reduction 6% a year to a maximum of 30%

58


2004-029 MPP 2006.10.20 NRA60

Canada Pension Plan – Take It or Leave It?Canada Pension Plan – Take It or Leave It?

Age when CPP payments beginAge when CPP payments begin 60 years60 years

% of CPP at age 65 % of CPP at age 65 ($863.75)($863.75) 70%70%

Monthly CPP incomeMonthly CPP income $605$605

ReductionReduction $259$259

Total payments from age 60 to 65Total payments from age 60 to 65 $36,300$36,300

Make-up time ($36,300 Make-up time ($36,300 ÷ ÷ $259) $259) == 140 months, or 140 months, or 11.7 years11.7 years

Age at break even pointAge at break even point 77 years77 years

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2004-029 MPP 2006.10.20 NRA60

Old Age SecurityOld Age Security

• Residency requirements must be satisfiedResidency requirements must be satisfied

• Payable at age 65Payable at age 65

• Taxed back if income exceeds a certain amountTaxed back if income exceeds a certain amount

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2004-029 MPP 2006.10.20 NRA60

Municipal Pension Retirees Association (MPRA)Municipal Pension Retirees Association (MPRA)

• voice concerns to the Municipal Pension Board on behalf of retirees

• belong to a support group

• share your skills, knowledge and experience

• stay in touch with colleagues

• make new friends

An association for retired municipal, health and education employees and their spouses to:

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2004-029 MPP 2006.10.20 NRA60

• Complete the application enclosed with the Complete the application enclosed with the retirement confirmation letterretirement confirmation letter

• Membership fees can be deducted from Membership fees can be deducted from your pension paymentyour pension payment

Municipal Pension Retirees Association (MPRA)Municipal Pension Retirees Association (MPRA)

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2004-029 MPP 2006.10.20 NRA60

Thank you for attendingThank you for attending

Please complete the evaluation Please complete the evaluation form because your feedback is form because your feedback is

important to usimportant to us

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2004-029 MPP 2006.10.20 NRA60

Contact InformationContact Information

Municipal Pension PlanMunicipal Pension PlanPO Box 9460PO Box 9460Victoria BC V8W 9V8Victoria BC V8W 9V8

VictoriaVictoria 250 953-3000250 953-3000Lower Mainland Lower Mainland 604 660-5366 604 660-5366Toll-free in BC Toll-free in BC 1 800 668-63351 800 668-6335Fax Fax 250 953-0421250 953-0421WebsiteWebsite mpp.pensionsbc.campp.pensionsbc.caE-mailE-mail [email protected] [email protected]

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police and firefighter retirement seminar

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