How returning to work can impact your pension
If you’re thinking about returning to work after you retire, it’s important to understand how your re- employment earnings can impact your PSPP pension.
What you need to know
If you return to work for a PSPP employer and you don’t rejoin the Plan, there are limits on the amount you can be paid in any calendar quarter before your pension is affected. This is referred to as the “quarterly re-employment earnings limit”. That means, if your gross earnings in any calendar quarter exceed your quarterly re-employment earnings limit, you’ll need to repay a portion, or all, of your pension for the period to us. We refer to the amount you must repay as a “pension overpayment.”
What’s your limit?
To find out what your quarterly re-employment earnings limit is, revisit your Confirmation Statement that we mailed you when you retired or the letter you received when you turned 65. You can also call us to confirm what your re-employment earnings limit is.
Here’s how we calculate your quarterly re-employment earnings maximum:
3 X (final month’s salary minus monthly pension)
Here’s an example:
| Calculation | Amount |
|---|---|
| Final month’s salary (based on your annual salary rate) | $5,000 |
| Minus your monthly pension | $3,000 |
| Equals | $2,000 |
| Multiply that amount by 3 | X 3 |
| Equals your quarterly earnings maximum | $6,000 |
If you retire early, you will be receiving the early retirement bridge benefit until age 65. Your quarterly earnings maximum will be different while receiving the bridge benefit and after age 65 when the bridge benefit stops.
We’re here to help
If you’re considering returning to work for a PSPP employer, we can help. We’re here to answer any questions you may have about how your pension could be affected. Please give us a call at 416-364-5035 or toll-free at 1-800-668-6203 and we’d be happy to help you.
Suggested reading
For more information, read the “Returning to work” page.