What are the benefits to buying credit?

As a new member, you might be able to increase the amount of pension you’ll receive by purchasing additional pension credit, also known as a "buy back". Purchasing credit might also help you retire earlier.

How do you know if you have service you can purchase or buy back? Here are some of the most common types of service new members purchase. Keep in mind this list isn’t exhaustive. You may also benefit from speaking to our Client Care Centre to better assess your pension situation and determine if your past service is eligible.

Did you:

  • Work for an employer that contributes to the PSPP or the OPSEU Pension Plan, but you did not contribute to either plan?
  • Work for a non-PSPP employer and were a member of another registered pension plan in Canada?
  • Take an unpaid leave of absence for more than 30 days when you didn’t contribute while on leave?
  • Contribute to the PSPP or the OPSEU Pension Plan and receive a payout of the full amount when you ended your employment?

If you answered "yes" to any of the above, give us a call to explore your options.

  • Buying back credit may help you reach a target amount of retirement income, and it may allow you to retire earlier (if you meet eligibility requirements)
  • Like other PSPP credit, buying back credit can provide a survivor benefit to your loved ones, (if eligible)
  • Like other PSPP credit, purchased credit is payable for life and is protected against inflation
  • You can choose how much credit you want to buy back; you can buy it all, some or none

How do I buy pension credit?

If you’re eligible to buy back pension credit, the first thing you need to do is complete the necessary application form, which in most cases will be OPB1043 – Application to Purchase Pension Credit (PDF). For most buyback applications, you will submit this form directly to us.

  • Please note that if you’re buying back a period of non-contributory service with an employer who contributes to the PSPP or the OPSEU Pension Plan, you must submit the OPB1043 form to your employer who will then submit it to us along with other required information.
  • If you are buying back full-time pension credit for a period of employment when you temporarily reduced your working hours, you must submit the OPB1151 form to your employer who will then submit it to us along with other required information. Learn more about the Temporary Part-time Work Arrangement.

We'll review the application and let you know if you’ve been approved, along with the cost to complete the purchase.

Depending on your previous employment and eligibility, there are a few ways you can pay for your buy back credit: personal cheque, direct transfer from a registered savings plan or pension plan, payroll deductions, or a combination of these options.

We recommend applying as soon as possible, as the cost generally increases over time. If a 24-month costing window applies to your buyback, it’s important to apply during this window, if possible. For more information on the 24-month window, please see below under the ‘When should I apply?’ section.

You should apply to buy back credit as soon as possible, because the cost of buying back credit will most likely increase over time. Additionally, some pension plans have time restrictions on taking out pension benefits for transfer between plans.

Although you can apply to purchase credit at any time while you’re an active member, the cost will likely be lower if you apply within the 24-month costing window. The start date of the window depends on your circumstances and the type of eligible period you are buying, but is usually the latest of:

  • The date you became a member of the PSPP (or in some cases, the OPSEU Pension Plan)
  • The last day of a leave of absence without pay with a PSPP employer
  • The last day of a legal strike, lockout or temporary layoff because of a legal strike or lockout
  • The date you received notification of a shortfall that resulted from transferring pension credit into the PSPP

After your 24-month costing window has ended, you can still buy back the pension credit as long as you are an active member of the PSPP, but the cost may be much higher. Note that any changes to your salary, even within the 24-month window, may impact your buyback quote, so we recommend you apply as soon as possible.

The cost of buying additional pension credit will depend on a few factors including:

  • When you apply for your purchase, particularly whether you apply within your 24-month costing window or outside your 24-month costing window (if that window applies to your buyback)
  • The type of eligible period you are applying to buy back
  • The length of that period

The cost of your buyback will be calculated based on your salary at the time we receive your complete application, including all supporting documentation. This can affect the overall cost of the buyback.

For members who started their most recent period of active PSPP membership on or after October 1, 2021: There is no 24-month costing window for this type of buyback; however, we recommend you apply as soon as possible as the cost will generally increase over time.

If you want to maximize your pension credit, there are some resources available to help you make the most informed decision.

To buy back pension credit for non-PSPP employer service and other service where your 24-month costing window has closed, use the Buyback Calculator available through your e-services account.

You can create your own personal estimate to buy back credit or forecast what your PSPP pension might be at retirement. Using the calculator, you can see how buying back pension credit will impact your pension, as well as determining whether it will help you qualify to retire earlier than age 65 with an unreduced pension. The calculator can also help you see the pension impact (in dollars) of buying back pension credit. To start using the calculator, click Login at the top right corner of this page.

If you have any questions about buying back or transferring pension credit, contact us at 416-364-5035 or toll-free at 1-800-668-6203, to discuss what options are available to you.

If you have a buyback quote and you’re not sure what to do, contact a Client Service Advisor. To book a 1-on-1 session, log into your e-services account and click Book my 1-on-1.