Guide for plan members
College Pension Plan is committed to helping you make the most of your pension. This guide is a provincial requirement. Please use the links at right to explore the topics most relevant to you.
How does the plan work?
The College Pension Plan is a defined benefit pension plan. Each time you are paid your salary, both you and your employer contribute to the plan. These contributions are pooled and invested so that you receive a lifetime monthly pension when you retire. About 70 per cent of the average pension payment is currently paid by the plan's investment returns.
Your lifetime monthly pension will be based on a specific formula that includes:
- Your years of pensionable service
- The average of your five highest years of salary (not necessarily the last five years)
When you retire, you will receive a monthly pension for your lifetime.
After you die, depending on the pension option you chose at retirement, the plan may continue to pay:
- A pension to your spouse (if you have one) for their lifetime
- Pension benefits to another beneficiary(ies)
- A lump-sum payment to your estate or an organization you have named as your beneficiary
As a new member, once you've made your first contribution to the plan, you can receive a pension at your earliest retirement age. If you're an inactive member who joined the plan before September 30, 2015, other conditions may apply.
Your pension and your job
What happens if you start a new job with the same employer
If you change jobs with the same employer, you will continue to be an active member of BC's College Pension Plan. Your contributions (and your employer's contributions) will be adjusted to reflect any changes to your salary.
What counts as leaving your job
If you leave your job, you will no longer be an active member of the plan and you will stop making pension contributions. In most cases, you are considered to have left your job when you permanently stop working for an employer that participates in the plan.
Some special cases:
- You are not considered to have left your job if you have:
- an agreement with a plan employer to return to work
- an established right to resume working for a plan employer
- You are considered to have left your job if you are on a seniority or recall list but have not worked for your employer or contributed to the plan for one full year
What happens if you take a new job with another plan employer
Each employer participating in the plan is considered a separate employer. When your job ends with your current employer, you will stop contributing to the plan. If you are eligible, you may be able to immediately re-enrol in the plan when you start your new job with a plan employer.
What happens if you leave your job with a plan employer
If you leave your job and are no longer working for an employer participating in the plan, you will need to decide what to do with your pension benefit.
Your options depend on:
- Your age
- If you are retiring
- If your new employer's pension plan has a transfer agreement with the College Pension Plan
Your options could include:
- Deferring your pension (leaving your money in the plan and taking a monthly pension when you retire)
- Transferring the commuted value of your pension to a locked-in retirement vehicle
- Applying for your pension
- Transferring your service in the College Pension Plan to your new employer's pension plan
Depending on your age when you leave your job, we will send you either a Termination selection statement form or a pension estimate outlining your options.
What are the contributions?
Both you and your employer make contributions to BC's College Pension Plan.
Your contributions are automatically deducted from each paycheque. Your employer's contributions are paid directly to the plan. Both your contributions and your employer's contributions are based on a percentage of your salary:
- You contribute 10.24 per cent of your salary
- Your employer contributes 10.34 per cent of your salary
These rates also include a contribution amount of 1.85 per cent from both you and your employer that is transferred to the inflation adjustment account. This account is used to pay for annual cost-of-living adjustments (COLAs) that may be added to monthly pension benefits. COLAs are not guaranteed, but once granted, they become part of your basic pension benefit.
When you stop contributing to the plan
Once you start contributing to the plan, you'll remain an active plan member until you leave your job or retire.
If you are on long-term disability, you do not make contributions to the plan; however, you will continue to earn contributory and pensionable service as though you had continued to work.
Will my contribution rate increase?
It is possible that the contribution rates may increase.
At least once every three years, an independent actuary (a specialist in financial modelling, the laws of probability and risk management) assesses the financial position of BC's College Pension Plan.
This assessment examines the plan's ability to pay all current and future pensions based on a series of economic and demographic assumptions (such as interest rates and life expectancy of members). It also reviews the current contribution rates to see if they are sufficient to fund the plan. Under the College Pension Plan Joint Trust Agreement, trustees may adjust contribution rates when needed to meet the plan's funding requirements.
If the actuary's assessment determines there is a funding shortfall, both your contribution rate and your employer's contribution rate may increase to meet the plan’s funding requirements. Contribution rate increases are shared equally by members and employers.
When can I retire?
For most employees participating in the plan, the normal retirement age is 65 and the earliest retirement age is 55.
The age at which you retire will affect your pension. For example, your pension may be reduced if you retire before age 65 and do not meet the criteria for an unreduced pension.
According to the Income Tax Act, you must begin to receive your pension no later than December 1 of the year in which you turn 71, even if you are still working.
Guide for plan members: links to additional information