The main purpose of your pension plan is to give you secure income to enjoy your retirement. Here’s what you can look forward to when the time comes.
Normal retirement starts on your 65th birthday.
However, you can take early retirement any time after age 55. Some members may be able to retire prior to age 55 if their age plus service equals at least 65 points (years), but no earlier than age 50. Depending on your age and years of service at retirement, your pension may be reduced. See What If You Retire Early for more information.
The main purpose of your pension plan is to give you secure income to enjoy your retirement. Here’s what you can look forward to when the time comes.
Normal retirement starts on your 65th birthday.
However, you can take early retirement any time after age 55. Some members may be able to retire prior to age 55 if their age plus service equals at least 65 points (years), but no earlier than age 50. Depending on your age and years of service at retirement, your pension may be reduced. See What If You Retire Early for more information.
Following retirement, you will receive a monthly income for the rest of your life. The amount is based on a formula that is the same for all MoveUP Plan members. Your annual pension income is calculated as:
Best Average Plan Earnings
The best (highest) average of your Plan Earnings (measured over your best three consecutive years).
Credited Service
Years of service with FortisBC during which you contributed to the MoveUP Plan plus approved periods of long-term disability or an approved WorkSafeBC claim.
Note that there’s a difference between Credited Service and Continuous Service.
Continuous Service alone refers to your years of employment with FortisBC (both Gas and Electric divisions) including periods of long term disability and any approved leaves of absence or maternity leave. Continuous Service is not used to calculate your monthly pension amount. However, it is used to determine your eligibility for retirement and early retirement reduction, if applicable. In calculating Continuous Service, no distinction is made between part time and full time employment.
Credited Service is used in the Pension Formula above to determine your monthly pension amount before any reduction for early retirement.
Your monthly pension will cease when you pass away, unless you pass away within the first five years, in which case there would be a death benefit payable to your beneficiary. Additional payment options will be made available at retirement.
Normal Retirement Calculation | ||
|---|---|---|
Annual pension | = 2% x Best Average Plan Earnings x years of Credited Service | |
= 2% x $65,740 x 30 years | ||
= $39,444 per year (or $3,287 per month) | ||
In this scenario, a monthly pension of $3,287 will be paid for your lifetime. Your monthly pension will be taxed similar to employment income at the time of payment, so the amount deposited to your bank account would be $3,287 less applicable withholding taxes.
Members can retire as early as age 55 (or as early as age 50 if their age plus continuous service totals at least 65 years). However, a reduction for early retirement may apply. This reduction is equal to 5% multiplied by the number of years by which your pension start date precedes the earlier of age 60 and the date when your age plus continuous service totals 80 years.
Your annual pension will NOT be reduced if you are at least age 60 on retirement, or your age plus continuous service totals 80 years.
In this example, you are retiring at age 57 and have 15 years of Credited Service. Your continuous service is also 15 years, which means that your earliest unreduced retirement date will be age 60 (since your age plus continuous service will be less than 80 years). Your best three years average Plan Earnings is $66,300.
Early Retirement Calculation | ||
|---|---|---|
First, calculate your pension entitlement for your Credited Service, again using the same formula as the normal retirement example:
| ||
Unreduced annual pension | = 2% x Best Average Plan Earnings x years of Credited Service | |
= 2% x $66,300 x 15 years | ||
= $19,890 per year (or $1,657 per month) | ||
Then, subtract the early retirement reduction {5% x years before age 60 (3 years)} = 15%: | ||
Reduced annual pension | = $19,890 x (100% – 15%) | |
= $16,907 per year (or $1,409 per month) | ||
In this scenario, your $1,409 pension benefit, less applicable income tax, will be deposited to your bank account each month following retirement for the rest of your life, with a five-year guarantee period.
In this example, you are retiring at age 55 and have 27 years of Credited Service. Your continuous service is also 27 years, which means that you are eligible for immediate unreduced retirement since your age (55) plus continuous service (27) is greater than 80 years. Your best three years average Plan Earnings is $66,300.
Early Retirement Calculation | ||
|---|---|---|
First, calculate your pension entitlement for your Credited Service, again using the same formula as the normal retirement example:
| ||
Unreduced annual pension | = 2% x Best Average Plan Earnings x years of Credited Service | |
= 2% x $66,300 x 27 years | ||
= $35,802 per year (or $2,983 per month) | ||
In this scenario, your $2,983 pension benefit, less applicable withholding tax, will be deposited to your bank account each month following retirement for the rest of your life, with a five-year guarantee period.
The normal form of pension gives you a lifetime pension paid on the last day of each month following your retirement date. It is guaranteed for 60 months (meaning that in case of death within the first five years after retirement, the balance of the 60 payments is payable to your beneficiary). If your retirement date is mid-month, your first payment will be pro-rated for the portion of the month that you are retired.
Your retirement statement will include a number of additional payment options for you to consider. Each option will be equal in Present Value to the normal form of pension.
When you retire, the MoveUP Plan may provide inflation protection to help safeguard the buying power of your pension by increasing the pension payable to you (or your surviving Spouse) on April 1st each year.
The rate of increase each April 1st will be equal to the percentage rate of increase in the Consumer Price Index for the given calendar year over the immediately preceding calendar year OR the amount that can be provided by the Excess Interest Account (the “EIA”), whichever is less.
The EIA is funded each year by the amount that investment returns exceed 5% on the assets backing pensions for deferred and retired members. The balance in the EIA fund is used to determine the amount of indexing that can be provided each year.
These increases will apply regardless of whether or not you have begun receiving your pension. For example, if you terminate employment and elect to receive a deferred pension from the MoveUP Plan, your deferred pension may be indexed each April 1st.
A detailed retirement process can be found on Connector. Please take note of the following:
Pension estimates and copies of your annual pension statements are available online using the Pension Web Portal. Feel free to contact TELUS Health for assistance with the Web Portal, or the FortisBC Pension Department for additional support.
Pension Web Portal
Log in instructions
Government benefits like Canada Pension Plan (CPP) and Old Age Security (OAS) are paid to eligible employees IN ADDITION to the MoveUP Plan monthly pension. For information on Government benefits, contact Service Canada.
