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Do you have a Pension Plan?

Stats Canada puts out tons of information, but I always find interesting spins on some of the stuff (no, I am not going to comment on Frozen Chicken Futures). Today they published the value of Employer Pension Plans in Canada. This is the value of employee pension plans that their employers are administering. Evidently, they lost value last quarter but have since rebounded.

What is more interesting to me is the following interesting statement:

About 4.6 million Canadian workers are members of trusteed plans. Of these, 2.5 million are public sector workers in municipal, provincial, and federal governments and enterprises, crown corporations, government boards, commissions and agencies, and public educational and health institutions. Private sector workers make up the remaining 2.1 million.

Five Dollars
Five Dollars Ain’t Much

So over 4 million Canadians are in a Pension Plan of some kind; I think that is a pretty good thing. Remember, a pension means you have income other than the Canada Pension Plan, and you can use your RRSP money as savings if you can live on your Pension.

Currently, I am a member of an excellent pension plan that is unfortunately capped for me. I understand why my employer is doing this, but it doesn’t mean I have to like it either. It seems more private companies are figuring out just how much of a burden a Pension Plan can be (not just administering it either, but also having to keep money in it).

Suppose you have a pension, good for you. If you don’t, better make sure your RRSPs are getting their maximum because you will be able to live on your CPP benefits.

4 thoughts on “Do you have a Pension Plan?”

  1. I’m actually doing what George suggested. I retired early with a good government pension at age 55 several years ago. My pension covers all of our basic, pre-retirement expenses.

    Our savings, most in RRSP accounts, have paid for retirement extras such as moving from Manitoba to Vancouver Island and for the purchase and operation of our sailboat. I plan to start taking CPP at age 60.

    Having the extra money saved over and above my pension made it possible to take early retirement.

  2. It’s actually not a bad idea to contribute to a RRSP even if you have a good pension plan. The funds can be used as an “early retirement” fund, to provide income in the years after retirement but before CPP and your pension kick in.

    Because of the pension adjustment, the amount you are allowed to put into an RRSP is lower than people without a pension plan.

  3. Absolutely I did not mean to imply that if you have a pension you are set for life, more that if you DON’T have ANY pension, you had better start saving NOW for your retirement. RRSP contribution is important whether you have a pension or not.

    –C8j

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