What is formula for calculating pensionable service?

Preparing for life after work. RRSPs, RRIFs, TFSAs, annuities and meeting future financial and psychological needs.
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Hopetoretire
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What is formula for calculating pensionable service?

Post by Hopetoretire »

Has anyone worked for the big blue bank? I'm planning my retirement and want to take advantage of the retirement health insurance sometime in the future. What is the standard formula used for calculating pensionable service as this will determine my eligibility for this and potentially other benefits which I'm still to discover/explore. And unlike many on this forum, I'm an immigrant and won't get full OAS so I need every dime I can get (and as they're always listed so boldly in my employee benefits!)
twa2w
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Re: What is formula for calculating pensionable service?

Post by twa2w »

Uh which big blue bank.
RBC, bmo?
I am guessing BMO by your comments?
brucecohen
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Re: What is formula for calculating pensionable service?

Post by brucecohen »

I don't understand your question. Normally one year of employment = one year of pensionable service.

Be aware that employer-paid/subsidized retiree health insurance is not covered by pension law and is thus not guaranteed. It's a contractual matter between employer and employees and the fine print in benefits booklets usually makes it subject to change. The trend has been for companies to reduce and even eliminate such coverage.
Spudd
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Re: What is formula for calculating pensionable service?

Post by Spudd »

brucecohen wrote:Normally one year of employment = one year of pensionable service.
But not always. At the company I used to work for (not a big blue bank), the first 2 years you were ineligible to join the pension, and those 2 years did not count as pensionable service. But the answer should be readily available either by asking HR or digging through your pension materials.
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ghariton
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Re: What is formula for calculating pensionable service?

Post by ghariton »

Spudd wrote:
brucecohen wrote:Normally one year of employment = one year of pensionable service.
But not always. At the company I used to work for (not a big blue bank), the first 2 years you were ineligible to join the pension, and those 2 years did not count as pensionable service. But the answer should be readily available either by asking HR or digging through your pension materials.
Yes. And I have seen companies which, for senior management, counted one year of actual service as one and a half or two years of pensionable service, depending on seniority.

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Shakespeare
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Re: What is formula for calculating pensionable service?

Post by Shakespeare »

I have seen a company which counted grad school as pensionable service.

I kid you not.
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Insomniac
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Re: What is formula for calculating pensionable service?

Post by Insomniac »

If it's a "big blue bank" you work for, they should have an employee portal or intranet. Pension info should be available there.
Hopetoretire
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Re: What is formula for calculating pensionable service?

Post by Hopetoretire »

Every bit of info is available except the formula. I also took some unpaid leave, some short weeks for caregiving and bereavement. And am only thinking about retiring, so don't want to alert TPTB who will likely "downsize" me to avoid paying the promised retirement benefits, and so they can hire some new blood cheaper. :(
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adrian2
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Re: What is formula for calculating pensionable service?

Post by adrian2 »

Hopetoretire wrote:Every bit of info is available except the formula.
Unless stated otherwise, it's the number of years you've been a member of the pension plan: one-to-one relationship.
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twa2w
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Re: What is formula for calculating pensionable service?

Post by twa2w »

If it is a bank, usually it is the number of years you have been a member of the pension plan but any leaves do not usually count and only full time employment counts on a one to one basis. As well for benefits only continuous service counts.
If you are part time and a member of the pension plan the pensionable service is prorated. Ie if you work 1/2 time you would get 1/2 year of pensionable service for 1 calendar year.

Calling the banks employee assistance line will not alert the powers that be.

Also you likely have to be over 55 to retire and get retirement benefits. If this is the case and the powers that be decide to downsize you, I would think they would offer you an early retirement package and you would be entitled to the same benefits as someone who voluntarily chose early retirement. I don't believe they could just let you go with a severance and not offer the early retirement option with the usual pensioner benefits.
Most banks, if you are past 55, you do not have the option of quiting. You must retire and begin your pension along with any benefits. ( and pension cannot be deferred to start at a later age)
Before age 55 you quit and lose any retirement benefits but you keep the pension and have the option of commuting it, or starting to take it at any age between 55 and 65.
Again it would help to know which bank.
I will give you an example from my own big blue bank experience after 27 years of employmet
Worked for bank 10 years
Moved to trust division 5 years
Quit and came back to trust division 9 months later.
Worked for 12 years between various big blue bank companies
Wanted to quit just after my 55 birthday.
I had to take my pension based on the 12 years service and retirement health benefits based on that.
I had the option of taking my previous 10 year and 5 year pensions then or waiting til no later than 65.
I decided to wait on those pensions.
When I take the additional 2 pensions, I will have 3 separate pensions all based on best 5 years relating to that service not best 5 years of total service which significantly impacts my total pension income. My benefits are based only on the last 12 years continous service. The bank could increase or decrease this benefit at any time.
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adrian2
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Re: What is formula for calculating pensionable service?

Post by adrian2 »

The company I work for has a DB pension plan.

Here is the verbiage from their website:
The amount of pension you receive under the Company Retirement Plan will depend on your
* age at retirement
* total Credited Service
* choice of plan option(s)
* Highest Average Earnings at retirement
* participation in any prior plans, if applicable.

Credited Service

Full-time permanent salaried employees: Your years and complete months of membership in the Retirement Plan.

Part-time permanent salaried employees: Your years and complete months of membership in the Retirement Plan multiplied by the ratio of your actual hours worked to the regularly scheduled hours of a full-time plan member.
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“It doesn't matter how beautiful your theory is, it doesn't matter how smart you are. If it doesn't agree with experiment, it's wrong.” [Richard P. Feynman, Nobel prize winner]
Hopetoretire
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Re: What is formula for calculating pensionable service?

Post by Hopetoretire »

Thanks, the Credited Service info will help me. I also moved from DB to DC, so the DB calculator shows pensionable services as if I was always on DB and also doesn't take into consideration my part-time work and unpaid leaves. I'll wait till January and then ask HR.

Off on a tangent here, but is there anyone single here with no dependents and how much are you paying for basic medical insurance, critical insurance, AD&D, if you didn't get benefits from your past employer? Moderator: please move to another thread if required.
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Re: What is formula for calculating pensionable service?

Post by flywaysuzy »

Your basic medical is variable depending on the province you live in. In BC, the annual premium varies from $460-$900/year, depending on your annual income, probably based on your income from the previous year. Additional coverage- dental, extended health, etc. could be obtained from an insurance company. You would have to check in your home province.
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