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.
Joint life pension options
A joint life pension is a monthly pension guaranteed for your lifetime and your spouse's lifetime. If you die before your spouse, they will receive your monthly pension or a portion of your monthly pension for the remainder of their life.
Your joint life pension options are:
- 100% joint life
- 60% joint life with a 5-, 10- or 15-year guarantee
If you have a spouse, you are required by law to choose a joint life pension option that leaves your spouse at least 60 per cent of your monthly pension payments should you die first. Your spouse can sign a waiver to give their right to this benefit, allowing you to select less pension protection (or no pension protection) for your spouse.
You can only name your spouse (or a former spouse if a court order or written agreement gives them an entitlement) for a joint life option.
If your spouse is younger than you, your pension payments will be smaller as it is assumed the pension will be paid for longer.
100% joint life
This option pays you a monthly pension for as long as you live and, if you die before your spouse, continues to pay your spouse your basic lifetime monthly pension for the rest of their life. It results in a lower monthly payment than a single life pension option because the pension is guaranteed for two lives. The pension payments end after both you and your spouse have died.
Why choose a 100% joint life pension?
This option pays your full lifetime monthly pension to your spouse after you die. This may be an important consideration if your spouse has no other significant sources of retirement income.
60% joint life with a 5-, 10- or 15-year guarantee
With this option, your basic lifetime monthly pension payment is guaranteed for your choice of a 5-, 10- or 15-year period. If you die within that time frame, your spouse will receive 100 per cent of your monthly pension for the remainder of the guarantee period only. After that, they will receive 60 per cent of your monthly pension for the rest of their life.
The 60% joint life option provides you with a higher monthly pension payment during your lifetime than the 100% joint life option. However, less of your pension will be paid to your spouse after your death.
For example, if you choose a 60% joint life pension guaranteed for 10 years, which is 120 payments, and die before receiving 120 payments, your spouse will receive 100 per cent of your basic pension until the 120th payment has been made. After that, they will receive 60 per cent of your basic pension for the rest of their life.
In this example, if you were to die after the end of the guarantee period, your spouse would receive 60 per cent of your lifetime monthly pension for the rest of their life.
Why choose a joint life pension?
- Your spouse will continue to receive a lifetime monthly pension after you die
- The 60% joint life option provides a higher monthly pension payment during your lifetime than the 100% joint life option
Important things to keep in mind
- Only 60 per cent of the pension will continue to your spouse if you die after the guarantee period expires