Hi i am thinking of releasing from the Army and chasing a Civi occupation and was just wondering if anyone could fill me in on the ballpark figures I could expect to get from my pension after 7 yeas enlisted in the reg force on normal pay scale as a CPL. Any info would help and I will check resources once I am able
Pension Transfer Value / Lump Sum Pymt [Merged]
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MikeL
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When you start the release process, the release clerk that is assigned to your file will go over how much you are getting, what you can do with it, etc. I had 7 years Reg Force time, plus some Reserve time when I released/went Supp Res. My pension was around $110000.
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MikeL
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Ryan, I PM'd you with some more info.
Yea, it was a lot more then I was expecting too.
I was part of the exclusive naked man on the beret club
Pension was $110k; a buddy of mine told me some friend's of his were getting around the same amount as well when they released. Hopefully the CF calculated everything correctly and doesn't send me a letter in the future asking for any of it back lol
Yea, it was a lot more then I was expecting too.
Dimsum said:Sure it wasn't $11k, as opposed to $110k?
Otherwise, what trade were you and how do I transfer to that?
I was part of the exclusive naked man on the beret club
Pension was $110k; a buddy of mine told me some friend's of his were getting around the same amount as well when they released. Hopefully the CF calculated everything correctly and doesn't send me a letter in the future asking for any of it back lol
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Dimsum said:Sure it wasn't $11k, as opposed to $110k?
Otherwise, what trade were you and how do I transfer to that?
I think he means he got $110K on release from the pension plan as a one time payment (transfer value), not as an annual pension.
$110K would be about right for the transfer value on release, assuming a Cpl with 7-8 years in. Your options on release are Transfer value (part to a locked in RRSP, part to cash), deferred annuity, transfer to an employer with a reciprocal agreement (such as RCMP or public service) and some others.
George Wallace
Army.ca Dinosaur
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-Skeletor- said:
Be wary of the TAXMAN.
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MikeL
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dapaterson said:
Correct, that is what I received.
RyanC said:
One last point, don't expect to see the money immediately or shortly after release. A month after I released I received a letter from Ottawa laying out all my options, and I had to pick what I wanted, and have the bank fill out some parts. I'm still waiting for the money to arrive in my account/RRSP, and I do not know when I can expect too see it.
George Wallace said:
Ack, the financial planner I spoke with went over that with me also. I cried a little inside when I found out how much the Gov't was taking back in taxes.
Yeah it is mostly going to rrsp so at least that wont be taxed for now, Need just enough to pay off some vehicle loans , Just hope I can arrange something with the lenders for my loans to hold off on repoeing my vehicles and busting my credit score
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RyanC said:
No. Locked-in RRSPs cannot be used for the Home Buyer's Plan.
http://www.investingforme.com/classroom/account-types/rrsp/withdrawals/home-buyers-plan-faq?q=300
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I released January 2011, and received my payout in May of the same year (3 year TOS). You cannot use your LIRP for anything but retirement. That was one of the first things I asked, home down payment, or education. Can't use it for either one.
George Wallace
Army.ca Dinosaur
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RyanC said:
It is my belief that if you have room in your RSP, you can put it all in. There is no percentage.
Now, when you are talking about 110k......Well, then the room in your RSP isn't that large.
In whatever the case, it may be advisable to get a Financial Planner involved, who would know all of this.
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When you finalize your out-clearance, they will go over it with you at that time. You have options of what you would like to do with the pensionable earnings, and how much you will be given as a "cash" payment. You should also receive a message outlining the amounts.
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George Wallace said:
George: There are Revenue Canada rules that govern this. The transfer value of your pension will go to you in two amounts: The first does not count against current RRSP contribution limits (as it was acquired through reduced contribution limits in the past) and goes to a locked in RRSP that is untouchable until retirement . (There are very limited situations where the money can be released before retirement).
The second is a cash amount that is taxable in your hands. You can deposit that into an RRSP if you have unused contribution room and defer taxes on it; you can then use that money for lifelong learning or home buyer's plan.
In my current civilian employment, the split between the two is about 50/50 (were I to take it today); your situation will likely differ.
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I was wondering if anyone might know;
- what one could expect for a pension payout if they were looking at getting out after their 3yr initial TOS?
- I was a component transfer and retained my rank of Cpl. when I went Reg. F, I assume that made a difference in the amount of money I was contributing, compared to say If I was a Pte. As a result, would I get a larger payout?
- what one could expect for a pension payout if they were looking at getting out after their 3yr initial TOS?
- I was a component transfer and retained my rank of Cpl. when I went Reg. F, I assume that made a difference in the amount of money I was contributing, compared to say If I was a Pte. As a result, would I get a larger payout?
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How many years does one need to serve in the Force to be eligible to retirement with full pension. Also, how much is the pension? And let say its 30 years, if you start at 18 at the RMC would you be able to retire at 48 or from the day you finish training for your job (about 23 years old)? Thank you.
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Pension amount depends on years of service. While some still serving are grandfathered, any new entries require a minimum of 25 years of service to qualify for an immediate annuity.
That 25 years includes any time in education or training.
After 25 years, your entitlement would be to a pension of 50% of the average of your pensionable earnings for your five consecutive years of highest earnings, through to age 65. At age 65 your pension is reduced to account for CPP benefits.
Longer service increases the amount of your pension, at a rate of 2% per year, to a limit of 70% of the average of your five years of highest earnings. Again, there will be a reduction at age 65 due to CPP.
There are additional complexities for retiring before having 25 years of CF service, medical retirement or other issues.
That 25 years includes any time in education or training.
After 25 years, your entitlement would be to a pension of 50% of the average of your pensionable earnings for your five consecutive years of highest earnings, through to age 65. At age 65 your pension is reduced to account for CPP benefits.
Longer service increases the amount of your pension, at a rate of 2% per year, to a limit of 70% of the average of your five years of highest earnings. Again, there will be a reduction at age 65 due to CPP.
There are additional complexities for retiring before having 25 years of CF service, medical retirement or other issues.
