Watch this quick video about the early retirement bridge benefit
The bridge benefit is a temporary payment that helps level your pension income until you reach age 65, at which point it ends. You can then collect an unreduced pension from the Canada Pension Plan (CPP).
The early retirement bridge benefit
Your retirement income before and after age 65
No matter when you choose to start your CPP pension, it will not impact the amount of your OPSEU Pension Plan and it won’t affect the amount of your bridge benefit.
In this example, the OAS starts at age 65. However, like the CPP, this benefit can be delayed up to age 70 and will increase as a result.
The key takeaway is that your combined pension from all sources may go up or down when you reach 65 depending on how much you receive from CPP and OAS and when you choose to start collecting them.
No matter when you choose to start your CPP pension, it will not impact the amount of your OPSEU Pension Plan and it won’t affect the amount of your bridge benefit.
In this example, the OAS starts at age 65. However, like the CPP, this benefit can be delayed up to age 70 and will increase as a result.
The key takeaway is that your combined pension from all sources may go up or down when you reach 65 depending on how much you receive from CPP and OAS and when you choose to start collecting them.
You will notice that there is no temporary bridge benefit – that’s because the bridge benefit is only payable until age 65. If you retire on or after age 65, you will not receive a bridge benefit.
If you retire at 65, the blue box – your lifetime pension from the OPSEU Pension Plan – is higher than it was in the previous example.
This is because you will have worked and contributed to the Plan for five additional years between the ages of 60 and 65 and your salary will have likely increased over that period as well, so your lifetime pension will be bigger than if you had retired at age 60.
Finally, the orange box – your unreduced pension from the CPP – has also increased. This is because you will have contributed to CPP for an additional five years as well.
You will notice that there is no temporary bridge benefit – that’s because the bridge benefit is only payable until age 65. If you retire on or after age 65, you will not receive a bridge benefit.
If you retire at 65, the blue box – your lifetime pension from the OPSEU Pension Plan – is higher than it was in the previous example.
This is because you will have worked and contributed to the Plan for five additional years between the ages of 60 and 65 and your salary will have likely increased over that period as well, so your lifetime pension will be bigger than if you had retired at age 60.
Finally, the orange box – your unreduced pension from the CPP – has also increased. This is because you will have contributed to CPP for an additional five years as well.
The Canada Pension Plan (CPP) and your pension from OPTrust
CPP is a federal program administered by Service Canada. It provides retirement benefits to individuals who have contributed to it during their employment. The pension is designed to replace about 25 per cent of the earnings on which you contributed to CPP during your career. CPP benefits and contributions change over time with changes to legislation or government policy.
The CPP benefit entitlement calculation can be complex. For information on your CPP benefits, we suggest you contact the Canada Pension Plan directly at servicecanada.gc.ca or toll-free at 1-800-277-9914 (within Canada and the United States).
Choosing to collect your CPP pension before age 65 will not affect your pension from OPTrust.
Choosing to collect your CPP pension before age 65 will not affect your pension from OPTrust.
In addition to CPP, you may be entitled to a retirement benefit from Old Age Security (OAS). It is payable monthly and indexed quarterly. OAS payments do not impact your OPTrust pension.
OAS payments are separate from OPTrust and CPP payments. OAS starts at age 65 and cannot be taken any earlier. Please contact Service Canada for more information about OAS.
In addition to CPP, you may be entitled to a retirement benefit from Old Age Security (OAS). It is payable monthly and indexed quarterly. OAS payments do not impact your OPTrust pension.
OAS payments are separate from OPTrust and CPP payments. OAS starts at age 65 and cannot be taken any earlier. Please contact Service Canada for more information about OAS.