Board Communique: August 15, 2019
A half temporary annuity option will soon be available to members.
As of November 10, 2019, there will be a second temporary annuity option, the half temporary annuity, available to members. It will give members greater flexibility in how they can supplement pension income before age 65, in exchange for a lower lifetime pension. This option will allow members to receive half the amount they would normally receive from the full temporary annuity.
What is a temporary annuity?
If retiring before age 65, members may choose a temporary annuity. Choosing a temporary annuity is like borrowing against the lifetime pension – it’s a temporary monthly payment that provides more retirement income before age 65 in exchange for a lower lifetime pension.
Currently the temporary annuity is based on the maximum Old Age Security (OAS) pension, and is payable to age 65 or death. The OAS pension is adjusted for inflation every quarter. As at July 1, 2019, the maximum OAS pension is $607.46 per month.
To learn more about the temporary annuity, click on Choose your pension option under related content.
What is the half temporary annuity?
With this option, the temporary monthly payments are half the payments that come with a full temporary annuity, but the lifetime monthly pension income decreases less.
This option will be based on half of the maximum OAS pension, and is payable to age 65 or death.
Members who elect the temporary annuity option may choose between the full and the half temporary annuity, provided that their lifetime pension supports the cost.
When can members apply for the half temporary annuity?
The half temporary annuity option will be available November 10, 2019.
Starting in fall, when the personalized pension estimators in My Account are updated to show both temporary annuity options, members will be able to see estimates of the impact of the full or half temporary annuity on their lifetime pension.
The temporary annuity option will reduce survivor benefits payable to a spouse or dependants. Members may wish to speak with an independent financial adviser before making a decision.