Congratulations! Planning for retirement is an exciting step in your life; however, it is also a time to make some important decisions. The following information is intended to provide you with a variety of tools and products to help you choose what is right for you.

You may want to know...

• Can you increase your pensionable service prior to retirement?
• What steps should you follow when preparing to retire?
• How do you make a pension benefit option?
• Why is your pension under the Public Service pension plan reduced at age 65?
• Is your pension benefit protected from inflation?
• Does your retirement date affect the pension increases (indexing) you receive?
• What insurance benefit plans continue after retirement?

Can you increase your pensionable service prior to retirement?
You may have periods of prior service that you can buy back to increase your pension. Any service buyback has to be made before you retire. For more information, refer to the Service Buyback Package.

What steps should you follow when preparing to retire?

Step 1: Take the time to familiarize yourself with your pension options.

Your options vary depending on your age and your years of pensionable service when you leave the Federal Public Service.

If you have at least 2 years of pensionable service, you may be entitled to the following options:

• Transfer Value
• Deferred Annuity
• Annual Allowance
• Immediate Annuity

If you have less than 2 years of pensionable service, generally you are entitled to the following:

• Return of Contributions

You may also be eligible to transfer all or part of your accrued pension credits to another pension plan through a Pension Transfer Agreement regardless of the number of years of pensionable service that you have to your credit.

Step 2: Find out the value of each of your pension options.

Take the time to look at your most recent personal Pension and Insurance Benefits Statement, as it provides you with a summary of your entitlements and their approximate value. The Pension Calculator can also help you estimate your yearly and monthly pension based on the information you enter.

As well, the Public Service offers several retirement courses which cover subjects such as: financial planning, the Public Service pension plan, legal aspects of retirement, health issues, and emotional issues.

Step 3: Find out which of your insurance benefit plans continue after retirement

• Retired members of the Public Service pension plan are eligible for coverage under the Public Service Health Care Plan (PSHCP) when receiving a pension. Learn more about what happens to your coverage when you retire.
• Your Public Service Dental Care Plan (DCP) coverage immediately ceases when you retire. However, as a retired member of the Public Service pension plan, you may have the option to enrol in the Pensioners' Dental Services Plan (PDSP). For details on how to enrol, refer to PDSP Enrolment Information.
• Your Disability Insurance Plan coverage ends on the day your employment terminates. If, however, you become totally disabled before you retire or resign from the Public Service, your disability benefits will continue to be paid for as long as you remain totally disabled and have not reached your 65th birthday. Disability benefits cease when you reach age 65.
• Your Supplementary Death Benefit Plan (SDB) coverage continues if you are eligible to receive an immediate pension within 30 days of your departure. If you do not receive an immediate pension, you must elect to continue your SDB coverage.
  
  As well, your spouse and children may be entitled to survivor benefits and child allowances in the event of your death.
  
  
• If you are a member of the Public Service Management Insurance Plan (PSMIP), your life insurance and that of your dependants will cease, subject to a 31-day extension period. During that extension period, you will be able to obtain an individual private life insurance policy. You must make your own arrangements directly with Industrial Alliance Insurance and Financial Services Inc. to convert your insurance to a private policy.
  
  Accidental Death and Dismemberment (AD & D) and Long-term Disability (LTD) insurances under the PSMIP cannot be converted to private policies, and terminate on the day you leave the Public Service.

Step 4: Estimate what your financial requirements will be when you leave the Public Service.

How do you make a pension benefit option?
To make your option, you must complete one of the following forms:

• Notice of Termination and Option for Benefit – Employees with Two or More Years of Pensionable Service (PDF 423KB, Help for PDF file)
• Notice of Termination and Option for Benefit – Employees with Less than Two Years of Pensionable Service (PDF 2.21MB, Help for PDF file)

Once you have completed the necessary form, you must submit the form to your Compensation Advisor who will forward it to the Public Service Pension Centre within one year from the day you leave the Public Service. If you do not make your option during this period, then you are considered to have chosen a deferred annuity payable at age 60. Subsequently, you may choose to receive an annual allowance at any time between the ages of 50 and 60.

Why is your pension under the Public Service pension plan reduced at age 65?
Your pension under the Public Service pension plan is reduced due to the coordination with the Canada Pension Plan (CPP) / Quebec Pension Plan (QPP). Your Public Service pension plan retirement benefit will be reduced at age 65 or when you begin receiving a CPP/QPP disability pension.

Is your pension benefit protected from inflation?
Yes. Your pension will be protected from losing its value as a result of inflation or increases in the cost of living for the rest of your life, unless you become re-employed and a contributor to the Public Service pension plan.

Does your retirement date affect the pension increases (indexing) you receive?
The Public Service Superannuation Act (PSSA) provides for annual increases, based on increases in the Consumer Price Index (CPI), on all pensions (including deferred annuities and survivor benefits). The increases are effective on January 1 of each year for those who have retired in the preceding year and all previous years.

The first indexing adjustment will be prorated to reflect the number of full months remaining in the year of termination of employment following the month in which you retired. In subsequent years, you will be entitled to the full increase.

Example: If an employee retires on August 20, then he would be entitled to a pension indexing increase of 4/12 of the total adjustment for the following year.

What insurance benefit plans continue after retirement?

• Retired members of the public service pension plan are eligible for coverage under the Public Service Health Care Plan (PSHCP) when receiving a pension. Learn more about what happens to your coverage when you retire.
• Your Public Service Dental Care Plan (DCP) coverage immediately ceases when you retire. However, as a retired member of the public service pension plan, you may have the option to enrol in the Pensioners Dental Services Plan (PDSP). For details on how to enrol, refer to PDSP Enrolment Information.
• Your Disability Insurance Plan coverage ends on the day your employment terminates. If, however, you become totally disabled before you retire or resign from the public service, your disability benefits will continue to be paid for as long as you remain totally disabled and have not reached your 65th birthday. Disability benefits cease when you reach age 65.
• Your Supplementary Death Benefit Plan (SDB) coverage continues if you are eligible to receive an immediate pension within 30 days of your departure. If you do not receive an immediate pension, you must elect to continue your SDB coverage.

As well, your spouse and children may be entitled to survivor benefits and child allowances in the event of your death.

• If you are a member of the Public Service Management Insurance Plan (PSMIP), your life insurance and that of your dependants will cease, subject to a 31-day extension period. During that extension period, you will be able to obtain an individual private life insurance policy. You must make your own arrangements directly with Industrial Alliance and Financial Services Inc. to convert your insurance to a private policy.

Accidental Death and Dismemberment (AD & D) and Long-term Disability (LTD) insurances under the PSMIP cannot be converted to private policies, and terminate on the day you leave the public service.