Newsletter Fall 2009
You and Your Employer Pension
Do you consider your Employer Pension Plan an Asset? Most working employees haven't considered this question. Its not that they are in the dark, its the lack of knowledge about their employer pension plan and understanding the workings of how they obtain money and the determination to be informed as they go to retirement.
At this crucial time as these workers transition to retirement, there is emotional factors that come into play:
- I am no longer needed or valued
- can I live on the income in retirement, usually 75% of current income
- what will I do
- can I afford to retire right now, are my financial affairs in good order
- Where can I find the answers to my questions
That last point is the one I would like to discuss today. Employers often hold seminars for those heading to retirement and give notice to employees in advance. This is usually on a first come/first serve so not all that should attend, do attend.
If your questions are not discussed in the seminars, please speak up and ask, others may not be so bold as to speak in public. Remember, any information is of value, knowledge plants seeds that may be cultivated in the future.
Research on your own is another way to find answers. There are books on retirement planning, pension books, and courses taught at night school on such subjects.
Of course, the first thing to do is to clearly understand your pension plan booklet, hold discussions with your spouse as to the different options you will have to choose as you go to pension. Study the options on pension carefully, they are irrevocable.
Pension Reform
The pension rules are outdated and Canada is looking at Pension Reform in all provinces to redo these rules, but that may take years to enforce. BC and Alberta are joining forces to combine their Provincial Pension BenefitsStandards Acts and looking at forming another optional suplimental pension plan, under this new joint legislation for those employees who do not have an employer pension plan in order to protect their retirement. View lots of info on the web on this subject for all provinces, but remember it is still in the early planning stages.
|
|
What's New in BC Pension Corporation Pensions
New pension rules came into effect July 1, 2009, and the booklet is available online on the BC Pension Corporaton website. Here are some of the contents in these new rules in each of the plans held under the BC Pension Corporation.
As of September 1, 2009 the BC Pension Corporation, has changed the payment and handling of Extended Health benefits for retirees. NOW, the retirees pay for these services, where it used to be a separate side of the pension fund reserves, the Corporation Board of Directors have come to the decision that the former employee pays the shot. The reasoning is spelled out on their website under each of the 4 plans (College, Municipal, Public Service and Teachers) and they indicate they need to build the inflation reserve account for future retirees, to have the capability (but not the promise) of paying an inflation adjustment to retirees. Did any retirees have any say in this move? Doubtful, as the public service retirees are actually suing the Pension corp for this very same reason, loss of benefits, and at that time it was only dental benefit losses.
Provincial government is still cutting deeply into senior employee positions as part of their downsizing efforts. Employees with up to 25 years service are being terminated and are unable to reach their necessary 85 years of service to receive the full pension amount. Options are available to these employees.
We offer assistance to those who need advice and look forward to working with employees to educate them. Give us a call - 1-877-371-8100
Canwest Restructuring Action
October 2009 saw a portion of Canwest Global Communications file for creditor protection, and that announcement and court appearance leaves some of the employees without their severance and possible pension and benefits drawbacks as this large conglomerate of companies looks to restructure and downsize its holdings. This is not only unfair but in the same breath, top executives will be privy to $9.8 Million in Key Employee Retention Plan bonuses.
Its high time employees took charge, they need to know the inside/out of their pension plan.
What will be next? The newspaper portion of Canwest Global Communications will be the next phase to see chaos in its closing of shops accross Canada. Some of these employees are already feeling hardship as they are in jeopardy of job loss.
|
