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Changes to your pension at 65

What you need to know
  • when you retire before age 65, OPTrust pays you a temporary additional benefit until your 65th birthday
  • at age 65 the temporary additional pension benefit ends
  • the Pension Information Change Statement (PICS) in your retirement package states your age 65 pension amount
  • you can apply to collect CPP at age 60
    but it is reduced for every year you are less than 65

    You can begin taking your CPP pension as early as age 60 at a reduced rate, as we mentioned earlier. Regardless of when you start collecting CPP, your OPTrust pension is integrated with CPP when you reach age 65.

    So, if you take CPP early, you will receive the reduced CPP pension plus a 2% OPTrust pension until age 65. At age 65, your CPP pension remains reduced, and your OPTrust pension is reduced for integration. While there will be a reduction in your combined income from the OPTrust and CPP pensions at age 65, some of this reduction may be offset by Old Age Security or seniors’ benefits.

    Some people prefer to receive this extra money earlier by taking early CPP, even though their total pension payments (OPTrust and CPP combined) will then be lower at age 65. Others prefer to delay receiving CPP until age 65, which results in more uniformity in total payments over time, and a higher combined income after age 65, as we will see in the following example.

    Example of Luis's OPTrust pension plus CPP

    Let’s assume Luis retires at age 57 with an unreduced OPTrust pension under the OPSEU Pension Plan’s Factor 90 option. Luis knows he is eligible for unreduced CPP benefits at age 65, but he is considering taking CPP early, starting at age 60. In this case, his lifetime CPP pension would be reduced by 30% (6% for each year he is under age 65).

    The example on the following pages shows how Luis’s combined monthly pension income and his lifetime pension income are affected by:

    1. the integration of his OPTrust pension, and
    2. the possibility of taking an early reduced pension from CPP.

    In calculating Luis’s lifetime income, we have assumed he will live to age 75. The examples do not show the effect of annual inflation-related increases to Luis’s OPTrust and CPP benefits.

    Example 1: Luis’s OPTrust Pension + CPP at age 65

    Luis’s OPTrust pension at age 57: Based on his average salary and years of credit, Luis is eligible for a monthly OPTrust pension of $2,000. When he turns 65, the OPTrust pension will be integrated with CPP and his OPTrust pension will be reduced to $1,442 per month.

    Luis’s CPP pension: If Luis takes CPP at age 65, he will receive a monthly benefit of $700.

    Luis’s OPTrust pension + CPP at age 65

    From age 57 to 65 (OPTrust pension)

    OPTrust pension payments of
    $2,000 per month x 8 years


    = $192,000

    Total pension income, age 57 to 65
    $2,000 per month x 8 years


    = $192,000

    From age 65 to 75

    OPTrust pension payments of $1,442 (after CPP integration) per month x 10 years


    = $173,040

    CPP pension of $700 per month x 10 years

    = $ 84,000

    Total pension income from age 65 to 75 $2,142 per month x 10 years


    = $257,040

    LUIS'S TOTAL LIFETIME PENSION FROM AGE 57 TO 75


    = $449,040

    In this example, Luis will start to receive his full CPP benefit at the same time as his OPTrust pension is integrated. As a result, his total pension income will remain relatively stable. In fact, because the OPTrust reduction for CPP is less than his total CPP benefit, Luis's monthly pension income will increase from $2,000 to $2,142.

    Example 2: Luis’s OPTrust Pension + Reduced CPP at age 60

    Luis’s OPTrust pension: As in example 1, Luis is eligible for a monthly OPTrust pension of $2,000 until age 65. When he turns 65, his OPTrust pension will be reduced for CPP integration to $1,442. Luis’s OPTrust pension will still be reduced for CPP integration at age 65, even if he decides to take CPP early.

    Luis’s CPP pension: If Luis takes CPP early at age 60, his monthly CPP benefit will be reduced by 30% (6% x 5 years) to $490 for his lifetime.

    Luis’s OPTrust pension + reduced CPP at age 60

    From age 57 to 60

    OPTrust pension of $2,000 per month x 3 years


    = $ 72,000

    Total pension income from age 57 to 60 $2,000 per month x 3 years


    = $ 72,000

    From age 60 to 65

    OPTrust pension of $2,000 per month x 5 years


    = $120,000

    CPP pension of $490 per month x 5 years

    = $ 29,400

    Total pension income from age 60 to 65 $2,490 per month x 5 years


    = $149,400

    From age 65 to 75

    OPTrust pension payments of $1,442 per month (after CPP integration) x 10 years

    = $173,040

    CPP payments of $490 per month x 10 years

    = $ 58,800

    Total pension income from age 65 to 75 $1,932 per month x 10 years


    = $231,840

    LUIS’S TOTAL LIFETIME PENSION FROM AGE 57 TO 75


    = $453,240

    In this example Luis will start to receive his reduced CPP benefit before his OPTrust pension is reduced for CPP integration. As a result, his total pension income will increase between the ages of 60 and 65. However, when Luis turns 65, his OPTrust pension will be reduced for CPP integration, while his CPP payments will continue at the reduced level. Consequently, his monthly pension income after age 65 will be lower than if he had started CPP at 65.

    FIGURE 1: LUIS’S MONTHLY PENSION: OPTRUST + CPP AT AGE 65

    Figure of pension performance

    Age OPTrust pension CPP pension Total
    57-65 $2,000 -- $2,000
    65-75 $1,442 $700 $2,142

    FIGURE 2: LUIS’S MONTHLY PENSION: OPTRUST + REDUCED CPP AT AGE 60

    Figure of pension performance

    Age OPTrust pension CPP pension Total
    57-60 $2,000 -- $2,000
    60-65 $2,000 $490 $2,490
    65-75 $1,442 $490 $1,932
  • you may be in a higher tax bracket when you start receiving CPP
How to apply for CPP and OAS
  • decide when to collect CPP, you can start as early as age 60
    • you must apply with Service Canada to collect CPP
  • apply with Service Canada for Old Age Security (OAS), six months before your 65th birthday
  • update your TD1 if your tax bracket changes
  • consider registering for OPTrust’s Online Services – to see your month PICS statement and to update your pension file
When to contact us
  • when any life changes occur – marriage, separation, divorce, death, new beneficiaries
  • changes to contact information – address, phone number, e-mail address

Forms you need to complete
  • Contact Service Canada to apply for CPP and OAS
Additional forms to complete, if applicable
Background material for more information
Government sites with pension benefit information