Pension payment options
As you prepare for retirement, choosing your pension payment option is one of the most important decisions you will make. This choice determines:
- The income you will receive for your lifetime
- Whether income will continue to a beneficiary after you pass away
No matter which option you choose, your pension is payable for your lifetime. All pension options are designed to give you the same total amount of money over time.
CSSB can’t tell you which option is best but here are some things to consider:
- Your and your spouse’s age, health, and life expectancy
- Financial needs of your dependents
- Your family’s overall financial situation
- Your retirement plans and income needs
- How you want to provide for loved ones
Important: Once your pension begins, your payment option can’t be changed. Understand these options so you can select the one that best meets your personal needs and retirement goals.
Pension payment options
Lifetime
You get your full pension amount for life.
No income is paid to anyone after your death.
You might choose this option if:
- You’re single with no financial dependants
- You’re not worried about leaving money behind
- You and your partner are financially independent
- Your partner is much older or has a shorter life expectancy than you
Guaranteed pension options
Minimum 10-year guarantee
This is a reduced pension, payable to you for life.
If you die within 10 years of retiring, payments continue to your beneficiary for the remainder of the 10 years.
For example, if you die two years after retiring, your beneficiary gets payments for eight years.
Beneficiary(ies) can be anyone.
Minimum 15-year guarantee
This is a reduced pension, payable to you for life.
If you die within 15 years of retiring, payments continue to your beneficiary for the remainder of the 15 years.
For example, if you die ten years after retiring, your beneficiary gets payments for five years.
Beneficiary(ies) can be anyone.
You might consider a guaranteed option if:
- You have health issues and don’t expect to live beyond the guarantee period
- You’re single and your partner doesn’t qualify as a common-law spouse under the plan
- You have a dependent, like a parent, sibling, or child, who relies on your income
- Your partner is much older or may not live as long as you
Survivor options
These options provide a reduced pension to you for life. When you pass away, your spouse or partner will continue to receive a portion of your pension.
1/2 to survivor (50%)
This is a reduced pension, payable to you for life.
After your death, your spouse or partner gets 50% of your pension for their lifetime.
If your spouse or partner dies before you, no pension will be paid after your death.
Your beneficiary must be a spouse or partner.
You might consider this option if:
- Your spouse has other sources of income in retirement
- Your partner is expected to pass away before you
2/3 to survivor (66.67%)
This is a reduced pension, payable to you for life.
After your death, your spouse or partner gets two-thirds (66.67%) of your pension for life.
If your spouse or partner dies before you, no pension will be paid after your death.
The beneficiary must be a spouse or partner.
You might choose this option if:
- Your spouse or partner has their own similar pension
- You want to provide enough income for your partner if you die first, but they don’t need the full amount
Full to Survivor (100%)
This is a reduced pension, payable to you for life.
After your death, your spouse or partner gets the full pension for their lifetime.
If your spouse or partner dies before you, no pension continues after your death.
The beneficiary must be a spouse or partner.
You might consider this option if:
- You want to leave the highest possible income to your spouse or partner if you pass away first
- You’re in poor health
- Your spouse or partner has little or no retirement income
- You have a young family and want to ensure financial security
- You want to maximize protection for your spouse or partner
Example calculations
In our example, the member and their spouse/partner are 55 years of age and the value of the pension, as per the pension formula, is $1,000 per month.
| Pension payment option | Amount of pension | Cost to provide to beneficiary | Amount to beneficiary on death of member |
|---|---|---|---|
| Lifetime | $1,000 | n/a | n/a |
| Minimum 10 year | $992 | $8 | $992 for balance of 10 years |
| Minimum 15 year | $983 | $17 | $983 for balance of 15 years |
| 1/2 to survivor* | $960 | $40 | $480 |
| 2/3 to survivor | $948 | $52 | $632 |
| Full to survivor | $924 | $76 | $924 |
Additional pension considerations
Personalized option
If none of these options meet your needs, you can design your own as long as it complies with the Income Tax Act and is approved by CSSB.
Inflation protection
If you pass away, the survivor and minimum guarantee payment options include two-thirds of past and future cost-of-living adjustments.
Unused contributions
After you and your spouse or partner pass away, any unused contributions and interest will go to your estate or your spouse’s estate.
Spousal waiver
A member who is married/common-law must be paid a pension that provides a minimum 2/3 survivor benefit on death, unless:
- Living apart because of a relationship breakdown, or
- Spouse or partner signs a waiver form at least 60 days before the pension begins
Resources
As you prepare for retirement, choosing your pension payment option is one of the most important decisions you will make. This choice determines:
- The income you will receive for your lifetime
- Whether income will continue to a beneficiary after you pass away
No matter which option you choose, your pension is payable for your lifetime. All pension options are designed to give you the same total amount of money over time.
CSSB can’t tell you which option is best but here are some things to consider:
- Your and your spouse’s age, health, and life expectancy
- Financial needs of your dependents
- Your family’s overall financial situation
- Your retirement plans and income needs
- How you want to provide for loved ones
Important: Once your pension begins, your payment option can’t be changed. Understand these options so you can select the one that best meets your personal needs and retirement goals.
Pension payment options
Lifetime
You get your full pension amount for life.
No income is paid to anyone after your death.
You might choose this option if:
- You’re single with no financial dependants
- You’re not worried about leaving money behind
- You and your partner are financially independent
- Your partner is much older or has a shorter life expectancy than you
Guaranteed pension options
Minimum 10-year guarantee
This is a reduced pension, payable to you for life.
If you die within 10 years of retiring, payments continue to your beneficiary for the remainder of the 10 years.
For example, if you die two years after retiring, your beneficiary gets payments for eight years.
Beneficiary(ies) can be anyone.
Minimum 15-year guarantee
This is a reduced pension, payable to you for life.
If you die within 15 years of retiring, payments continue to your beneficiary for the remainder of the 15 years.
For example, if you die ten years after retiring, your beneficiary gets payments for five years.
Beneficiary(ies) can be anyone.
You might consider a guaranteed option if:
- You have health issues and don’t expect to live beyond the guarantee period
- You’re single and your partner doesn’t qualify as a common-law spouse under the plan
- You have a dependent, like a parent, sibling, or child, who relies on your income
- Your partner is much older or may not live as long as you
Survivor options
These options provide a reduced pension to you for life. When you pass away, your spouse or partner will continue to receive a portion of your pension.
1/2 to survivor (50%)
This is a reduced pension, payable to you for life.
After your death, your spouse or partner gets 50% of your pension for their lifetime.
If your spouse or partner dies before you, no pension will be paid after your death.
Your beneficiary must be a spouse or partner.
You might consider this option if:
- Your spouse has other sources of income in retirement
- Your partner is expected to pass away before you
2/3 to survivor (66.67%)
This is a reduced pension, payable to you for life.
After your death, your spouse or partner gets two-thirds (66.67%) of your pension for life.
If your spouse or partner dies before you, no pension will be paid after your death.
The beneficiary must be a spouse or partner.
You might choose this option if:
- Your spouse or partner has their own similar pension
- You want to provide enough income for your partner if you die first, but they don’t need the full amount
Full to Survivor (100%)
This is a reduced pension, payable to you for life.
After your death, your spouse or partner gets the full pension for their lifetime.
If your spouse or partner dies before you, no pension continues after your death.
The beneficiary must be a spouse or partner.
You might consider this option if:
- You want to leave the highest possible income to your spouse or partner if you pass away first
- You’re in poor health
- Your spouse or partner has little or no retirement income
- You have a young family and want to ensure financial security
- You want to maximize protection for your spouse or partner
Example calculations
In our example, the member and their spouse/partner are 55 years of age and the value of the pension, as per the pension formula, is $1,000 per month.
| Pension payment option | Amount of pension | Cost to provide to beneficiary | Amount to beneficiary on death of member |
|---|---|---|---|
| Lifetime | $1,000 | n/a | n/a |
| Minimum 10 year | $992 | $8 | $992 for balance of 10 years |
| Minimum 15 year | $983 | $17 | $983 for balance of 15 years |
| 1/2 to survivor* | $960 | $40 | $480 |
| 2/3 to survivor | $948 | $52 | $632 |
| Full to survivor | $924 | $76 | $924 |
Additional pension considerations
Personalized option
If none of these options meet your needs, you can design your own as long as it complies with the Income Tax Act and is approved by CSSB.
Inflation protection
If you pass away, the survivor and minimum guarantee payment options include two-thirds of past and future cost-of-living adjustments.
Unused contributions
After you and your spouse or partner pass away, any unused contributions and interest will go to your estate or your spouse’s estate.
Spousal waiver
A member who is married/common-law must be paid a pension that provides a minimum 2/3 survivor benefit on death, unless:
- Living apart because of a relationship breakdown, or
- Spouse or partner signs a waiver form at least 60 days before the pension begins