Not Sure Whether to Buy Back?
If you're on the fence about buying back your leave, here are six things to keep in mind:
- When you buy back you bring yourself closer to collecting an unreduced pension, and you collect that pension for longer (instead of working and paying contributions for an extra year).
- You have five years from the time your leave ends to pay for your buyback.
- You can transfer your RRSPs to pay for all or a portion of your buyback.
- Cash payments can provide a tax deduction, saving you money at tax time.
- Contributions to your pension plan, including buybacks, are matched by your employer.
Essentially, this means you are paying for 50% of your retirement.
- Investing your funds in your pension is a good idea.
The security of a defined benefit pension plan is hard to beat.