Kick start your pension

September 05, 2013

This is part 1 of a series on transferring credit based on the types of scenarios we see at Teachers'. Read part 2.

Getting a full-time career up and running can take some time. Many new members don't realize that while they build their teaching careers, there's a possibility they can kick start their pensions.

Let's take a look at Serena's story. It's based on the types of scenarios we often see at Teachers'.

Serena worked as a teaching assistant for the Toronto District School Board for five years before she earned her teaching certification. During that time, she contributed to Ontario Municipal Employees Retirement System (OMERS). Even with her new accreditation as a qualified teacher, she has not found a teaching position, so she continues to work as a teaching assistant for the same school board.

While Serena's employer has not changed, because she is now certified to teach in Ontario and is working for a school board that participates in the Ontario Teachers' Pension Plan, she is now a member of Teachers' and no longer contributes to OMERS.

Serena is happy to be a member of Teachers'. The transition from OMERS to Teachers' was seamless. Her employer directs her contributions to Teachers', so she didn't have to do a thing. What she doesn't realize though, is that the credit she accumulated in OMERS has not automatically been transferred over to Teachers'.

Why does this matter?

Teachers' has a reciprocal transfer agreement with OMERS, under the Major Ontario Pension Plans (MOPPS) Transfer Agreement, so she can transfer credit between the plans. Serena calls Teachers' and speaks with a Pension Benefits Specialist (PBS). The PBS walks her through downloading an authorization form that will give the pension plans permission to exchange her information in order to calculate transfer values.

Because Teachers' is such a robust retirement plan, sometimes credit from another pension plan is not equal to Teachers' credit. If this is the case, we'll calculate the difference and allow up to five years to pay the difference. Once Serena receives the transfer values, she has 90 days to decide if she wants to go ahead with the transaction.

Deadlines apply to MOPPS transfers. You must apply for the transfer within 18 months of leaving your past job, and within 6 months of joining Teachers'. Call us if you think you have eligible credit.

Why should she consider transferring credit?

Maximizing credit in the pension plan will increase the amount of Serena's monthly benefit when she does retire, and will allow her to qualify  sooner for an unreduced pension. In the pension world, having one unreduced pension is better than having multiple reduced pensions. The whole is greater than the sum of the parts.