How we calculate your pension
We calculate your pension based on your years of service and the average of your five highest years of salary.
Retiring at or after the normal retirement age
If you retire once you are age 65 or older, or age 60 or older if you're in Group 2, we calculate your pension using the following formula:
If you are a police officer or firefighter in Group 5 and retire at age 60 or older, we calculate your pension using the following formula:
Retiring before the normal retirement age
If you retire before age 65, or age 60 if you're in groups 2 or 5, your pension will include a temporary monthly payment called a bridge benefit. This bridge benefit covers the difference between your early retirement income and the additional income you may receive after age 65 through Canada Pension Plan and old age security benefits. The bridge benefit ends when you turn 65 or die, whichever happens first.
We calculate your pension and bridge benefit using the following formula:
If you are a police officer or firefighter in Group 5, we calculate your pension and bridge benefit using the following formula:
Factors that affect your monthly pension paymentThese basic pension formulas are based on a single life pension option with no guarantee. The monthly pension payment you receive will depend on several other factors, including:
- Your age when you retire, which may result in a reduced pension
- The pension option you choose to protect a beneficiary
- The premiums you pay for health care coverage through the group benefit plan
- Any legally required deductions such as income tax
After you retire, your monthly pension payment may increase if there is an annual cost-of-living adjustment (COLA). This adjustment is added to the basic lifetime portion of your pension. The COLA is also applied to the bridge benefit and the temporary annuity portion of your pension while you are receiving them.
COLA is based on the Canadian consumer price index and is applied to your pension in January each year if the Municipal Pension Board of Trustees determines that sufficient funds are available in the plan’s inflation adjustment account.
Although future COLAs are not guaranteed, once you have received the adjustment it becomes part of your lifetime pension for all subsequent years.