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Pension Plan FAQs |
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The following are the most commonly asked questions by
Members regarding their Pension Plans.
If you have questions after reading this information,
please contact the Plan Administrator. |
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Where can I get detailed information on my specific Pension
Plan?
Every Member of every Pension Plan is issued a Pension Plan Booklet when they enrol
in the Pension Plan. This should be your first resource for detailed information on your
Pension Plan. If you have misplaced your booklet or did not receive one when you enrolled
in your Plan, please contact the Plan
Administrator.
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What kind of Pension Plan does my company/union have?
There are two basic types of Pension Plans:
- Traditionally, most Pension Plans were "Defined
Benefit" Plans. This means that the
formula that will be used to calculate your Pension benefits is pre-determined. Usually
it is tied to your annual earnings while working. For example, the Pension benefit formula
used to determine your annual Pension benefit at retirement might be: 50% of your earnings
in the year immediately prior to retirement. If you earned $60,000 in your final year of
employment, your Pension benefit would be $30,000/year.
- The newer form of Pension is a "Defined
Contribution" Plan. In a Defined Contribution
Plan, the amount that the company contributes into your Pension Fund each year is
determined in advance. The company might contribute a fixed amount each year (e.g. $1000) or
they might contribute a percentage of your earnings in the year (e.g. 3%).
The amount of Pension that you receive at retirement will be
determined by how much the company contributes to the fund each year and how much
interest is gained by the fund prior to your retirement.
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