Video Centre - Changes to the Canada Pension Plan

Transcript

(Open with the Host walking into frame. Animated red line leads into the text Changes to the Canada Pension Plan appears behind the Host.)

Hi, my name is Selena, and I'm a Service Canada employee.

(Cut to a tight shot of the Host.)

Are you retired or thinking about retiring? If so, you'll want to know about the changes coming to the Canada Pension Plan starting on January 1, 2011.

(Cut to medium shot of Host. LINE DRAWING: Stick person flexes his muscles.)

You know, we Canadians are living longer, healthier lives, and this is really changing how we make the transition from work to retirement.

(Cut to tight shot of Host. Words “Canada Pension Plan” appear on screen.)

So the Canada Pension Plan, more commonly known as the CPP, is adapting to the ways we choose to live, work, and retire. Soon you'll have more options to make the decisions that are right for you.

(Cut to medium shot of Host. LINE DRAWING: Stick person carries a placard with the 2011 printed on it. He flips it around revealing 2016 .)

Changes will gradually be introduced from 2011 to 2016.

(Cut to medium shot of Host. Words “December 31, 2010” appear on-screen. LINE DRAWING: Stick person swings a golf club.)

If you started receiving a CPP pension before December 31, 2010, and you stay out of the work force, you won't be affected.

(Cut to tight shot of Host.)

So what are the changes for employees and self-employed people who contribute to the CPP?

(Cut to a medium shot of Host. Graph appears showing how the amount of retirement income a person will receive depends on the age at which they retire.)

Well, starting in 2011, if you decide to receive your CPP retirement pension after 65, the amount you receive will increase by a larger percentage. For example, as of 2013, if you start receiving your CPP pension at 70, your benefit amount will be 42% more than if you take it at 65. That's up from 30% before the changes.

(Graph age line shrinks, showing decrease in earnings.)

On the other hand, beginning in 2012, if you choose to receive your pension before 65, the amount will decrease by a larger percentage.

This means that by 2016, if you start receiving your CPP pension at 60, your benefit amount will be 36% less than if you take it at 65. Before the changes, it was 30%.

(Cut to tight shot of Host. LINE DRAWING: Words “Number of years of low or zero earnings” appear. Arrow then appears forcing the words upwards, indicating an increase in pension earnings.)

Starting in 2012, the number of years of low or zero earnings automatically eliminated from the calculation of your CPP pension will increase, which will likely increase your pension benefits.

(Cut to a medium shot of Host. LINE DRAWING: Stick person works at computer, then gives thumbs up.)

Also, you will be able to take your CPP retirement pension without any work interruption, making it much easier for you to phase into retirement.

(Cut to tight shot of Host.)

The last change affects people between the ages of 60 and 70 who work while receiving a CPP retirement pension.

(Cut to a medium shot of Host. LINE DRAWING: Two stick people appear seated at both sides of a desk. A piggy bank sits atop. Dollar signs flow from each stick person into the piggy bank. The piggy bank grows. The words CPP Post-Retirement Benefit appear above .)

Starting in 2012, if you are under 65 and work while receiving your CPP retirement pension, you and your employer will have to make CPP contributions.

(Cut to a full-frame shot of the animated box. Animated cash rises over the box's sides. CPP changes web page appears in background.)

But, between the ages of 65 and 70, you can either choose to make contributions, or opt out. If you choose to make contributions, your employer will still have to contribute. These contributions will ultimately increase your retirement income through the new Post-Retirement Benefit.

(Cut to medium shot of the Host. LINE DRAWING: Stick person is seated behind his desk operating his computer.)

Now, all these changes to the CPP may affect your retirement planning, including when you decide to apply for your CPP retirement pension.

For more information, check out all our online resources. They'll help you effectively plan your retirement future.

(Cut to medium shot of the Host. LINE DRAWING: Stick person bows.)

At Service Canada, we're people serving people.

(Dip to black.)