Leaving your employer
Ending your employment before retirement
What's on this page
- Terminating your employment before retirement
- Pension options available at termination
- Should I choose a deferred pension or commuted value?
Pension options
Deferring your pension
If you leave the employment of a WISE Trust participating employer but are not yet eligible for an immediate pension, you may leave your pension entitlement in the Plan and defer receiving it. This is called a deferred pension.
What is a deferred pension?
The amount of your deferred pension is what you earned up to the date you terminated employment. You can receive it as a pension as early as your reduced or unreduced retirement age, or on your normal retirement age of 65. Refer to Collecting your pension for more information.
A deferred pension receives the same indexing as retiree pensions during the deferral period. Refer to Indexation for more information.
This is the default option for members who do not return the election form by the deadline indicated in the termination/retirement package. The default selection is irrevocable; you cannot request to transfer commuted value to another retirement arrangement after the deadline.
Transferring your commuted value to another pension plan
To transfer your pension, you’ll have to make your request to transfer within the deadlines outlined by your new pension plan. You can contact your new employer for eligibility details.
If you’re entitled to transfer the commuted value to your new employer’s pension plan, there are two ways you can do it:
- with a reciprocal transfer agreement or
- without a reciprocal transfer agreement.
If you’re not sure what this means, read about how a reciprocal transfer agreement works in transferring the commuted value of your pension.
Transferring your commuted value to a locked-in retirement arrangement
If you terminate your employment before age 55 and you’re not eligible to retire immediately (and you don’t want to defer your pension), you may transfer the commuted value of your pension out of the Plan.
In most cases, provincial pension law prohibits you from taking your termination benefit in cash. The money must be used to provide you with a retirement income and must be paid by the end of the year in which you reach age 71.
If you are eligible, you may transfer your commuted value to the following locked-in vehicles:
- a locked-in retirement account
- a life income fund
- another retirement savings vehicle prescribed by applicable pension legislation
Commuted value
What is a commuted value?
The commuted value of your pension is the amount of a lump sum payment, in today’s dollars, estimated to be equal in value to your future pension payments. You may be able to transfer the commuted value to a new employer’s registered pension plan (if applicable) or a locked in retirement arrangement.
When can you transfer the commuted value and what are your options?
If you have terminated your employment before age 55 and are not eligible to retire immediately, you may transfer the commuted value of your pension entitlement to a locked-in savings vehicle.
Once you transfer your commuted value out of the Plan, you’re responsible for the investment of those funds. You’ll receive no further benefits from the Plan. If you were participating in your employer’s group benefits programs at the time you terminated your employment, transferring your pension entitlement out of the Plan may affect your eligibility for post-retirement group benefits as well. Contact your employer’s HR department for more information.
When can’t you transfer the commuted value and what are your options?
- age 55 or older
- less than age 55, but are eligible to receive a pension under the Plan’s Factor 85 early retirement option
Should you choose a deferred pension or commuted value?
Whether you transfer your commuted value to a locked-in retirement arrangement or to leave your entitlement in the Plan is an important decision.
Commuted value estimates
Given the potential for commuted values to change due to interest rates and actuarial assumptions, your actual commuted value will only be provided when required by law upon notice of your termination of membership in the Plan.