Choose your pension option
This important decision will determine the amount of your lifetime monthly pension payments and the amount your spouse or beneficiaries may receive when you die.
Single life pension options
You can choose a single life pension option if you are single or your spouse has given up their beneficiary rights to your pension.With a single life pension, your lifetime monthly pension payment is guaranteed for your choice of a 5-, 10- or 15-year period. If you die before the end of the guarantee period, your beneficiaries will receive the monthly pension for the remainder of the guarantee period only.
For example, if you choose a single life pension guaranteed for 10 years and die before 120 payments have been made to you (the end of the 10-year guarantee period), what's left of your pension will continue to be paid monthly to your beneficiary until the last (120th) payment has been made.
If you live beyond the guarantee period, you will continue to receive your monthly pension for the rest of your life. However, when you die, no pension will be paid to your spouse, beneficiary or estate.
Beneficiary options with a single life pension
When you choose a single life pension, you can name any individual, organization or your estate as your beneficiary(ies).
If you have a spouse, you can only choose a single life pension if your spouse signs a waiver to give up their rights to a 60 per cent joint life option. To name a beneficiary other than your spouse for a guarantee period, your spouse must also give up their beneficiary rights.
Why choose a single life pension with a guarantee?
If you die within the guarantee period, your beneficiary will receive a time-limited monthly income. This option often appeals to single members with dependants. For example:
- You have an 11-year-old child when you retire and select a 15-year guarantee
- If you die within the 15-year guarantee period and your child (or have named a trustee or have a trust set up for your child when they are under 19) is named your beneficiary, your child will receive some income until they are 26
- Your spouse (assuming they have waived their right to the joint life pension) has RRSPs but wants to defer cashing them in until age 71; you may want to support your spouse until they can access the RRSP income by selecting a 5-, 10- or 15-year guarantee, depending on their age
- Your family history suggests that you will have a shorter life expectancy; choosing a guarantee may allow you to leave a lump sum for your estate
- If you outlive the guarantee period, your spouse or beneficiaries will not receive any of your pension
- If you have a spouse, you can only choose a single life pension if your spouse waives their beneficiary rights to your pension
- You cannot change your decision after 60 days from the date your pension is granted, and depending on your situation, you may not be able to change it at all
- When you die, your spouse or beneficiaries are no longer eligible for coverage under the pension plan's extended health care and dental plans
- If you have a former spouse, you may be required to provide some of your pension to them under the terms of a separation agreement or court order