Choose Plan Option

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Choose Plan Option

Choose Plan Option

The amount of pension you receive when you retire, and the amount that is left to your surviving partner or beneficiary in case of death, varies depending on which one of the eight plan options you select.

Choosing the plan option that is best for you is a personal decision based on your specific situation and will be the most important decision you have to make before you retire. Read the details of each option below.

If you are single:

Plans A and B are available to you.

If you are married or living common-law and you and your spouse/partner* are cohabiting in a conjugal relationship at the time of your retirement:

All plan options are available to you.

  • Under Plans A and B, you can designate anyone as your beneficiary.
  • Under Plans C to H, your spouse or partner must be your beneficiary.

* “Spouse” or “partner” includes your married or common-law partner, provided you are not living separate and apart due to a relationship breakdown at the time you commence your pension. The term “spouse” and “partner” are used interchangeably.

Make your decision carefully as your plan option cannot be changed once you receive your first pension payment, and you cannot name a new beneficiary under Plans C to H, even if you remarry.

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Plan options

Example:

If your base pension is $3,000 per month, you receive the full amount of $3,000 per month for your lifetime. When you pass away, your pension ends.

Why would I choose this option?

  • This plan pays the highest monthly pension for your lifetime and is not affected by your partner’s death.
  • You are single with no dependants.
  • Your partner has a shorter life expectancy.
  • Your partner is financially secure.
  • You are in good health.

What should I take into consideration?

A monthly payment will not be provided to your partner or dependants after your death.

You will receive less than the base pension for your lifetime. The pension payment is guaranteed for 10 or 15 years from your retirement date. If you pass away before the end of the 10 or 15-year guarantee period, the monthly pension continues to your beneficiary or estate for the remainder of this period only.

If you live beyond the guarantee period, the monthly pension continues for your lifetime.

Example:

If you are age 55 and your base pension is $3,000 per month, under Plan B – 10-year Guarantee you receive $2,991 per month for your lifetime. If you pass away during the first 10 years, your beneficiary receives the same amount for the remainder of the 10 years, but no income after that.

Why would I choose this option?

  • You are single with dependants.
  • This is the only option that allows you to name anyone as your beneficiary and change this designation any time during the guarantee period.
  • If your partner has a shorter life expectancy, it guarantees your pension will not change if he or she passes away. It also provides protection for your partner in case something unexpected happens to you during the first 10 or 15 years.
  • If you marry or live common-law during your retirement, it provides an option to leave income to your new partner during the guarantee period, as you can change your beneficiary any time.

What should I take into consideration?

  • You receive slightly less pension than you would under Plan A.
  • A monthly income will not be provided to your partner or beneficiary if you pass away after the end of the guarantee period of 10 or 15 years.

(Not available to members who are single. Beneficiary may only be partner.)

You will receive less than the base pension for your lifetime. Upon the death of either you or your partner, the pension continues in the same amount to the survivor for life.

Example:

If you and your partner are age 55 and your base pension is $3,000 per month, you receive $2,821 per month for your lifetime. On the death of either you or your partner, the benefit remains at $2,821 per month to the survivor for life.

Why would I choose this option?

  • This is the only plan that allows you to leave the full pension to your partner after your death. This may be important if your partner has no pension income. It also continues to provide you with the full pension if your partner passes away first.
  • The pension remains the same no matter who passes away first. This may be critical if you have dependants or financial commitments.

What should I take into consideration?

  • With Plan C, you will receive the lowest amount of monthly pension.
  • If your partner is significantly younger, the pension will be lower than the amounts payable under other plan options because the pension will likely be paid for a longer period of time.

(Not available to members who are single. Beneficiary may only be partner.)

Depending on the age of your partner, you may receive more or less than the base pension. Upon the death of either you or your partner, the pension reduces to 2/3 and is paid to the survivor for life.

Important: The pension under this option reduces, whether you or your spouse passes away first. Therefore, TRAF must be contacted upon the death of you or your spouse. Failure to promptly notify TRAF of a death can result in a pension overpayment, which must be repaid to TRAF.

Example:

If you and your partner are age 55 and your base pension is $3,000 per month, you receive $2,944 per month. On the death of either you or your partner, the pension reduces to $1,962 per month and is paid to the survivor for life.

Why would I choose this option?

  • This plan provides a higher initial pension than Plans C and G, while still providing 2/3 of the pension to the survivor.
  • If your monthly pension is high, a reduction to 2/3 may still be a sufficient income for the survivor.
  • You will have other sources of income in retirement.

What should I take into consideration?

  • If your partner passes away before you, your pension reduces to 2/3.
  • This plan may not meet your income needs if you expect your TRAF pension to be the main source of your retirement income.
  • TRAF must be contacted promptly upon the death of you or your spouse.

(Not available to members who are single. Beneficiary may only be partner.)

Depending on the age of your partner, you may receive more or less than the base pension. Upon the death of either you or your partner, the pension reduces to 1/2 and is paid to the survivor for life.

Important: The pension under this option reduces, whether you or your spouse passes away first. Therefore, TRAF must be contacted upon the death of you or your spouse. Failure to promptly notify TRAF of a death can result in a pension overpayment, which must be repaid to TRAF.

Example:

If you and your partner are age 55 and your base pension is $3,000 per month, you receive $3,009 per month. On the death of either you or your partner, the pension reduces to $1,504 per month and is paid to the survivor for life.

Why would I choose this option?

  • This plan provides a higher monthly initial pension than Plans C, D, F and G, while still providing 1/2 of the pension to the survivor.
  • You will have other sources of income in retirement.
  • You expect to receive a large amount of money such as an inheritance.

What should I take into consideration?

  • If your partner passes away before you, your pension reduces to 1/2
  • This plan may not meet your income needs if you expect your TRAF pension to be the main source of your retirement income.
  • TRAF must be contacted promptly upon the death of you or your spouse.

(Not available to members who are single. Beneficiary may only be partner.)

You will receive less than the base pension for your lifetime. If your partner passes away before you, your monthly pension does not change. However, if you pass away before your partner, your pension reduces to 1/2 and is paid to your partner for life.

Example:

If you and your partner are age 55 and your base pension is $3,000 per month, you receive $2,907 per month for your lifetime. If your partner passes away first, your pension remains at $2,907 per month. If you pass away first, your partner receives $1,453 per month for life.

Why would I choose this option?

  • Your pension remains unchanged if your partner passes away first.
  • Similar to Plan E, it leaves 1/2 of your pension to your partner.
  • Your partner does not need the full pension but you still want to leave some additional income to your partner.

What should I take into consideration?

  • This plan leaves 1/2 the pension to your partner, so it may not be ideal if you have dependants or financial commitments.
  • If you have a shorter life expectancy, you should carefully consider your partner’s source of income should you pass away first.

(Not available to members who are single. Beneficiary may only be partner.)

You will receive less than the base pension for your lifetime. If your partner passes away before you, your monthly pension does not change. However, if you pass away before your partner, your pension reduces to 2/3 and is paid to your partner for life.

Example:

If you and your partner are age 55 and your base pension is $3,000 per month, you receive $2,878 per month for your lifetime. If your partner passes away first, your pension remains $2,878 per month. If you pass away first, your partner receives $1,918 per month for life.

Why would I choose this option?

  • Your pension remains unchanged if your partner passes away first.
  • Similar to Plan D, it leaves 2/3 of your pension to your partner.
  • Your partner does not need the full pension, but you still want to leave some additional income to your partner.

What should I take into consideration?

  • This plan leaves only 2/3 of the pension to your partner, so it may not be ideal if you have dependants or financial commitments.

(Not available to members who are single. Beneficiary may only be partner.)

If Plans A to G do not suit your needs, you can design your own plan. This pension must be paid monthly and it must be acceptable under the Income Tax Act (Canada).

Important: If your personalized option involves a reduction to the last survivor, TRAF must be contacted upon the death of your spouse. Failure to notify TRAF of a death can result in a pension overpayment, which must be repaid to TRAF.

Why would I choose this option?

  • If one of the existing plans is not quite right for you, Plan H allows you to adjust the levels or add a guarantee.

What should I take into consideration?

  • TRAF’s actuary must ensure that the plan is feasible.
  • If your personalized option involves a reduction to the last survivor, TRAF must be contacted upon the death of your spouse.
Plan option comparisons table image

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Contribution and interest guarantee

In all cases, if the pension payments made to you and your beneficiary(ies), if applicable, total less than your contributions plus compounded interest at your retirement date, the difference is refunded to your estate or beneficiary. You may wish to designate a contingent beneficiary(ies) for this purpose. Your pension contributions and interest are generally paid out within eight to nine years of collecting pension.

Plan Options contribution and interest

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How to proceed

Ensure you understand how each plan option works, including how your pension is impacted on your death or your partner’s death, if applicable. Contact us if you have any questions.

Select your plan option when you complete your Pension Application.

If you are married or living common-law and you and your spouse/partner are cohabiting in a conjugal relationship at the time of your retirement:

And you select an option other than Plan D – 2/3 to Last Survivor:

  • Your partner must complete the Spouse/Common-law Partner Authorization section of the Pension Application.

And you select a plan option that provides less than 60% to your partner (i.e., Plan A, B, E, F or H, if applicable):

  • Your partner must waive the minimum requirement by completing and submitting to TRAF Form 5A – Waiver of 60% Joint Survivor Pension within 60 days prior to your pension effective date. TRAF will provide this form directly to your partner by mail at that time. If the required waiver is not submitted within the prescribed time limits, your pension will default to Plan D – 2/3 to Last Survivor.

Your partner may revoke the authorization and/or waiver at any time before your pension commences by providing written notice to our office.

Submit your application and the required documents to TRAF at least three months prior to the date you want your pension to start, and up to 12 months in advance (except for Form 5A – Waiver of 60% Joint Survivor Pension, if applicable, which must be submitted within 60 days prior to your pension effective date).

If you are registered for Online Services, you can fill out your pension application online before sending it to TRAF. Alternatively, you can contact our office for a paper copy of the Pension Application.

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Resources

Plan Options

Connect With Us

If you have any questions about your pension, get in touch. We are happy to help you over the phone or by email. If you’re considering retirement, contact us to book an appointment.

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