Building your pension

When you joined the CAAT Pension Plan, you immediately began building a solid foundation of retirement income. That may not seem particularly important – especially if you’re nowhere near retirement age – but by taking some time to learn about your what the Plan has to offer, its value will become clear.

Your CAAT Pension Plan pension follows a Defined Benefit model – the pension formula is defined up front, and all pensions are calculated the same way. Throughout your membership, your regular contributions to the Plan are matched dollar for dollar by your College. Over time, as your years of service in the Plan and your income increase, your pension will grow.

With Canadians living longer and other shifts in demographics, it’s important to have retirement income you can count on. When you begin collecting your pension – as early as age 50 in some cases – you will receive it for life.You cannot outlive your benefit – it will be a predictable, secure payment that will form the cornerstone of a comfortable retirement.

Your employer matches your contributions dollar for dollar

During your membership, you’ll make contributions based on a percentage of your salary. Your employer contributes toward your future retirement income as well, by matching your contributions in the Plan. Your contributions are tax deductible to you, meaning they lower your income for tax purposes. In addition, you pay no income tax on the matching contributions made by your employer.

Every year you’ll receive an Annual Statement which shows the growth of your pension year over year. You’ll see how soon you can retire on a “normal retirement pension” and get an estimate of the earliest dates you’ll reach eligibility for a reduced and an unreduced pension. These dates can help you plan for your future. You’ll also see the amount you’ve contributed to the Plan, and any service you’ve transferred in. The pension formula and calculations use your own data, to help you track the growth of your pension over time.

Not everyone stays with their employer until the day they retire. If you leave your college employment for another job outside of the college system, you may be able to take advantage of the Plan’s portability options, which allow you to transfer your pension to your new employer’s pension plan and keep building it. Alternately, you might have joined the Plan from an employer with a pension plan. Consider transferring your pension from your previous employer into the CAAT Pension Plan, so you can explore the benefits of continuing to build one, larger pension, rather than 2 smaller ones.

If you choose to keep working past age 65 (called the “normal retirement date”), your pension will keep on growing. Once your pension starts, the Plan helps it retain its purchasing power by paying inflation protection on parts of it. Your spouse will receive a lifetime survivor pension after you die, at the rate of 60% of your lifetime pension (or 75% if you choose that option at retirement).