PENSION FAQS

Pre-retirement

1. When can I retire?

As an active plan member, you may retire at age 60 with a full pension, or as early as age 55 with a reduced pension.  If you leave the industry and break service before age 55, you will become an inactive plan member. You will be entitled to receive a full pension benefit at age 65 or a reduced pension payable as early as age 55.

Planning on retiring soon? Please contact the Plan Office at least three months before your planned retirement date to complete the necessary paperwork and ensure you receive your pension payments on time.

 

2. How much will my pension be when I retire?

The amount of pension you receive is based on your years of credited service as well as the contributions you and your employer contribute to the plan.

 

3. When can I transfer out my pension?

If you work for less than 350 covered hours in two consecutive calendars years, you break service with the plan and become a deferred plan member. If you are under age 55 when you break service, you will be given a one-time option to either remain in the plan and receive a pension from the plan in retirement, or take a lump-sum payout from the plan and end your membership. You will be given 90 days after receiving a break in service notice to request a lump-sum payout from the plan. After 90 days, this option expires and you must leave your pension in the plan until retirement.

If you do break service, you can expect to receive a termination statement in March of the year following your break in service. The deadline to request a lump-sum payout will be indicated on your termination statement.
 

4. What is a lump-sum benefit?

When you break service with the plan, you may be entitled to receive a lump-sum benefit. This is calculated as the amount of money that, if invested today and left until you are 65 years of age, would be expected to provide the same monthly pension as you would have received from the Plan at 65. The amount of pension you receive is based on your years of credited service as well as the contributions you and your employer contribute to the [lan. If you break service and you have not attained age 55, you are entitled to receive a lump-sum transfer of your termination benefit, as long as you transfer in the time limit provided by the plan, usually 90 days after your break in service.

 

5. Do I need to notify the Plan Office that I intend to retire, or will my pension start automatically upon my retirement?

Your pension does not begin automatically, so you must inform the Plan Office of your intention to retire. Your pension will not be backdated. We recommended applying for your pension three months before your anticipated retirement date.

 

6. If I retire at 60 years of age and receive 100% of my pension, will my pension be reduced at age 65?

If you are an active member of the pension plan, you can retire as early as 60 years of age and receive 100% of your pension. Normally, you will continue to receive 100% of your pension for the remainder of your life. However, if you select the supplemented retirement option, your pension income will be reduced at age 65. This reduction is intended to equal the amount you will receive from Old Age Security.

 

7. I am a 55-year-old deferred member with 8 years of credited service. Can I take a lump-sum pay-out now, and how do I find more information about this?

Early retirement from the plan begins at age 55 for both active and inactive/deferred members. At retirement, if the lump-sum value of your pension is less than the legislated threshold (currently set at $11,180), you can choose to transfer your pension out of the plan as a lump-sum. If the lump-sum value of your pension is above this threshold, you must instead take a lifetime monthly pension from the plan at retirement. Contact the Plan Office for a pension estimate and to see which situation applies to you.

 

8. If I die before applying for my pension, does my spouse get any benefits?

Yes. Should you did before collecting a pension from the plan, depending upon the lump-sum value of your pension, your spouse will have the option of receiving either a monthly pension or a one-time lump-sum payout from the plan. Please make sure that we always have your correct beneficiary contact details on file, and be sure to keep us informed of any changes to your spousal status.

 

9. What happens if I collect my Canada Pension Plan benefits early at age 60?

The Canadian Pension Plan (CPP) is separate from the IWA-Forest Industry Pension Plan. Whether or not you collect CCP has no impact on your pension from this plan.

 

10. I have 25 years of credited service but have not worked in the industry for 10 years. I am now 60 and work another line of work. Because I work outside the plan, can I collect my pension without any reduced rates from now until I turn 65?

As you have not worked for a participating employer for more than two years, you are considered an inactive (or deferred) plan member. Inactive members are eligible for a reduced pension from the plan as early as age 55, or a full pension from the plan at age 65.

 

11. Can my monthly pension income in retirement be reduced?

The IWA-Forest Industry Pension Plan is a target benefit plan. According to provincial pension legislation, when negotiated contributions do not cover the minimum required contribution level to fund the plan on a going concern basis as per the actuarial valuation report, benefits must be reduced or a contribution increase must be negotiated to meet the required contribution level. Good news: at its latest valuation, the pension plan was fully funded on a going concern basis, and throughout its 45-year history, the pension plan has never reduced monthly pension benefits for retired members.

 

12. I have a seasonal retail store and I'm wondering what would happen if I decide to retire early. Would I still be able to collect my pension?

All members of the pension plan can retire as early as age 55. You can continue to work and receive your pension from the plan at the same time as long as you are not working for a participating employer for more than 76 hours per month (or an average of 19 hours per week).

 

13. Is there a resource for medical plans available in Canada for members to look at as there is a myriad out there and this can be confusing?

Unfortunately, this is not something that we provide. We recommend seeking the advice of a trusted independent financial advisor.

 

14. In regards to excess hours, if I retire at age 60 will those hours increase my pension as if I were retiring at say 62 or 63?

Accrued excess hours can be used at retirement to give you one extra year of credited service. For example, you can retire in January 2019 and use 1,500 accrued excess hours to receive a full year’s worth of credited service for 2019, without needing to work even one hour. Doing this will boost your pension income by up to $60 per month.

 

15. If you retire at age 55 at 82% does your pension increase at age 56 to 86% and so on to 100% at age 60?

No. Your pension income remains the same throughout your retired life. If you retire at age 55 as an active member, you will receive 82% of your pension for your lifetime. If you retire at age 56 as an active member, you will receive 86% of your pension for your lifetime… and so on, according to the subsidized early retirement benefit.

 

16. If I retire age 60 and receive 100% of my pension, does stay at 100% for my lifetime?

Yes. Your pension option and income remain the same throughout your lifetime.

 

17. The Canada Pension Plan provides a cost of living increase, why doesn’t this plan?

Every pension plan is different. This pension plan provides certain benefits such as the subsidized early retirement benefit (which half of all retirees receive) and unfunded hours. Indexing is not available for this plan. The terms of the pension plan are established by the board of trustees, who are appointed by forest industry associations and the USW. At the Plan Office, we simply administer the pension plan according to the plan rules.

 

18. What happens to my medical coverage after I retire?

The IWA-Forest Industry Pension Plan does not offer medical coverage. If you would like extended medical coverage, you must purchase coverage through a group plan administrator.

 

19. What is the difference if I retire at age 60 at 100% or wait until I am 65?

If you are an active member of the plan, you can retire as early as age 60 and receive 100% of your pension from the plan. You must receive your pension from the plan by December 1st of the year you turn 71. If you continue to work for a participating employer after age 60, you will increase your years of credited service and therefore increase your monthly pension income from the plan in retirement. When you choose to retire is up to you, but you should know that your pension cannot be backdated, and you cannot work 76 hours per month for a participating employer and still receive a pension from the plan.

 

20. How do I get an application form?

You can download pension-related forms, including a retirement application, from the Plan Office website at www.iwafibp.ca/forms.

 

21. Can the joint spousal amount be less than 60% but more than 0% of my pension?

No. Unless your spouse waives their right to lifetime survivor coverage, the minimum spousal coverage is 60% of your pension income.

 

22. How is the lump-sum value of the pension calculated?

A. The lump-sum value of your pension is calculated as the value today of your future pension, based on your age, applicable interest rates and other assumptions in accordance with the Pension Benefits Standards Act.

 

23. How do you calculate the supplemented early retirement option? I would like to retire at 55 and have 32 years of service?

Because government benefits begin at age 65, you can choose to receive a greater pension amount from the plan prior to age 65 and a smaller amount after age 65. The difference between the amounts paid before and after age 65 is intended to equal the amount you receive from Old Age Security. If you would like specific numbers, contact the Plan Office for a pension estimate.

 

24. Is there an option for a lump-sum payment for your contributions, and if so how is it calculated?

If the lump-sum value of your pension is less than the legislated threshold (currently set to $11,180), you have the option of receiving your pension as a one-time lump-sum payout. If the lump-sum value of your pension is equal to or greater than the legislated threshold, you must receive a lifetime monthly pension from the plan, and do not have the option to transfer your pension out of the plan as a lump-sum payout. Note that your lump-sum payout is equal to the value today of your future pension, and is not necessarily equal to your total contributions to the plan.

 

25. Where can I find the breakdown of the dollar amounts for each year to calculate your pension, and if you retire early at 55 is it 82% of those amounts?

The amount of your pension in retirement depends upon your years of credited service, your membership status and age at retirement, and the pension option that you select. You can find more information and a full explanation of the subsidized early retirement option for active members and the actuarial early retirement reductions for inactive members on pages 20 and 21 of the pension plan booklet.

 

26. If I retire at age 55, what will my pension look like in terms of rate of benefits?

Again, please refer pages 20 and 21 of the pension plan booklet for information on early retirement. Or, contact the Plan Office for a complete pension estimate.

 

27. I am 46, have disability pension from WorkSafesBC. I am retired. Is there a one-time buy out?

This pension plan does not offer any buyouts. If you are a member of the IWA-Forest Industry Pension & LTD Plans and are currently receiving disability income from the LTD plan, you will continue to accrue credited service in the pension plan until you reach (typically) age 60. At that time, you will be able to collect a monthly pension from the pension plan, or transfer the lump-sum value of your pension out of the plan if it is less than the legislated threshold of $11,180.

 

28. If I have been approved for LTD benefits till the age of 60, how do I calculate my standard pension if I live till that time, to receive a regular pension?

Your pension income is based on a formula which multiplies your years of credited service with the benefit level for those years. If you are a member of both the pension and LTD plans, you will accrue credited service in the pension plan for the length of time that your receive disability benefits from the LTD plan. Please contact the Plan Office and we will be happy to provide you with an estimate of your pension from the plan.

 

29. Can I use my accrued use excess hours for past years?

If you work or otherwise accrue more than 1,500 funded hours in a year, those hours in excess of 1,500 are recorded as excess hours. Your excess hours cannot be used to increase your past years of service. However, you can use your accrued excess hours to bring your credited service up to 1,500 in the year you retire. For example, you can retire on January 1st, 2019, and use 1,500 accrued excess hours to receive a full year’s worth of credited service for 2019, without needing to work even one hour in 2019. Doing this will boost your pension by up to $60 per month.

 

30. At age 65, what percentage of deduction happens for my wife and I to receive the joint and survivor option?

Your monthly pension income will vary depending on the pension option you select. The variation between options is typically a few hundred dollars per month. If you would like more information, please contact the Plan Office and we will be happy to provide you with a pension estimate for all the different options. Note that if you have a spouse and wish to select any option other than a joint and survivor option, your spouse will need to sign a form waiving her right to a lifetime pension.

 

31. After leaving the industry 20 years ago, I now also have another pension from a different source. Do I have to apply for my pension with the IWA-Forest Industry Pension Plan at the time of my actual retirement or can I hold off until age 65?

Inactive (also called deferred members) and active plan members can choose to retire and collect a pension from the plan anytime between the ages of 55 and 71. As an inactive member, as long as you are not working 76 hours or more per month for a participating employer, you can receive a reduced monthly pension from the plan as early as age 55, or a full pension from the plan as early as age 65. Whether or not you are part of another pension plan has no effect on the value of your pension from the IWA-Forest Industry Pension Plan, nor the age at which you can collect your pension from the plan.

 

Post retirement

 

1. What should I do if my pension cheque doesn't arrive?

If you have not received your pension cheque by the 1st of the month, please contact the Plan Office.  If you moved recently, we may not have a current address.

 

2. What should I do if my pension benefit doesn't arrive in my bank account?

Pension cheques are automatically deposited in your bank account on the 1st of every month.  If your cheque does not arrive in your bank account, please contact the Plan Office.  If you've changed bank accounts recently, we may not have the correct account information. Changes to your banking information do not occur automatically; you need to complete a new direct deposit authorization form.

If the 1st of the month falls on a weekend or public holiday, the payment will be deposited on the next business banking holiday. 

3. I've changed banks. How do I make sure my benefit will get deposited correctly?

You must complete a new direct deposit authorization form and return it to the Plan Office in order for us to make changes to your banking information.  

 

4. How do I report the death of someone who was receiving a pension?

Please contact the Plan Office as soon as possible.  Any payments made to the pensioner in the month following the month of the pensioner's death must be returned to the plan. Plan Office staff will review the pensioner's file and determine if any death benefits are to be paid (depending on the option chosen by the member) and will adjust the records and, if applicable, the pension benefit amount, accordingly. The Plan Office also requires a copy of the death certificate.

 

5. What happens to my pension if I return to work after I retire?

You cannot receive a pension and earn pension credits in the pension plan at the same time. If you retire and begin to receive your pension, then return to work for a participating employer: Your pension will stop if you work 20 hours or more per week.

  • When you stop working for a participating employer, any pension credits you have earned since you started working again will be added to your retirement benefit.
  • Your pension will continue if you work less than 20 hours a week for a participating employer.
  • Your pension will continue regardless of your employment status if you work after December 1st of the year in which you turn age 71.

You ARE NOT restricted from working full-time or part-time in non-IWA work.


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