Thank you so much for all those information, I’m in US but it applies to my situation as well. I have to watch few time to understand all content. Great job to put this all together.
The conversion of the DB to a LIRA, then goes to a LIF. Depending on the jurisdiction of the Pension, there is a minimum but also a MAXIMUM that can be drawn. So in many cases it is impossible to create the same income from a LIF than a DB. Some DBs if reasonably well funded, there may be a reduced reduction to take a pension at 55 and this makes it superior to taking the pension at 65 and again it may be impossible to create the same income stream from the LIF. Having 28 years as a fee only planner. a general rule of thumb. 40 years of age and less then 20 years of service take the lump sum. 50 years of age and short service, take the lumpsum. Over 50 and long service and a well funded DB, pay the money to a fee only person advisor. May save your bacon for the rest of your life.
Sometimes the calculation gets extra complicated. My wife's government backed pension has been underfunded for a long time (15+ years). The way her pension works is that if the pension is less than 90% funded then the existing retirees don't get their CPI indexing. So comparing lump sum to retirement income is very hard when we don't know if the plan will be indexed.
Thank you so much for all those information, I’m in US but it applies to my situation as well. I have to watch few time to understand all content. Great job to put this all together.
The conversion of the DB to a LIRA, then goes to a LIF. Depending on the jurisdiction of the Pension, there is a minimum but also a MAXIMUM that can be drawn. So in many cases it is impossible to create the same income from a LIF than a DB. Some DBs if reasonably well funded, there may be a reduced reduction to take a pension at 55 and this makes it superior to taking the pension at 65 and again it may be impossible to create the same income stream from the LIF. Having 28 years as a fee only planner. a general rule of thumb. 40 years of age and less then 20 years of service take the lump sum. 50 years of age and short service, take the lumpsum. Over 50 and long service and a well funded DB, pay the money to a fee only person advisor. May save your bacon for the rest of your life.
under 40 years old and under 20 years of service you would say lump sum? even if way over 6% rule?
Sometimes the calculation gets extra complicated. My wife's government backed pension has been underfunded for a long time (15+ years). The way her pension works is that if the pension is less than 90% funded then the existing retirees don't get their CPI indexing. So comparing lump sum to retirement income is very hard when we don't know if the plan will be indexed.
Bridge..from 50 to 64? Do you need to apply and what form? Is this offered in Ontario too?
Its automatic
If your on cppd is that the flat rate anf is it index to inflation and cost of living? How will you know..arent the two different types under cpp