Dream Bigger: Learn about Defined Benefit Pension Purchases


What if we told you there was a way to increase the pension amount you receive at retirement?

Although your CAAT pension is calculated using a fixed formula, you can grow an even bigger pension by purchasing an eligible period of employment. A purchase is an agreement to ‘buy back’ additional pension for a period of your employment when you weren’t contributing to your pension plan. This means a bigger pension in retirement and possibly an earlier retirement date for you. Sounds appealing, right? Well, these are not the only benefits a purchase gets you. Read on to learn more about its many benefits and how you can get started on this process.

So why make a purchase?

There are many reasons why you should consider making a purchase. The obvious one is to create a higher retirement income: your purchase leads to a higher monthly payment. You may even be able to retire sooner than you had planned.

Plus, a purchase spares you the time and effort trying to invest your retirement savings yourself. It simplifies your life by consolidating your retirement savings, so you can collect your retirement income from one secure source.

Another reason a purchase could be the right move is that it includes all the valuable benefits you currently enjoy with your CAAT Plan. Things like conditional inflation protection increases after you retire and survivor benefits to your surviving spouse are included at no additional cost when you make a purchase.

And to top it all off, CAAT won’t charge any fees for your purchase. You get to enjoy an excellent return on your investment in the form of additional pension in retirement, knowing your pension is managed by a trusted and secure pension plan.

What’s next: How to get started with your purchase

Now you know how valuable a purchase can be, the next step is to start the process. The purchase process can be completed in three stages – Learn, Return and Earn.

Learn: The first step to a purchase is learning if you’ve got an eligible employment period. Eligible employment periods can be broken down into two categories –

  • periods of employment before you enrolled in CAAT and
  • periods of leave when you were a member of CAAT.

Periods of employment before you enrolled can include:

  • when you were working with a CAAT employer but hadn’t joined the Plan yet, or
  • when you were with another employer’s pension plan other than your current CAAT Plan (if your pension is still in your previous employer’s pension plan, you must transfer it out as a part of making a purchase in the CAAT Plan).

On the other hand, periods of leave happen while you’re a member of CAAT. They can include

  • unpaid leaves of absence,
  • statutory leaves where contributions were not made during the leave (including pregnancy, or parental leave).

When you’ve determined you have an eligible period of purchase, the next step is to get an estimate of how much you can purchase. Use the purchase tools on the CAAT website to get an estimate on your purchase. Then you can download and fill out the official purchase application form.

Return: When you’ve completed the form the next step is to submit your application to CAAT. Guess what? You are already halfway through! CAAT will send you a purchase package with all the information you need to make your decision. All you need to do at this point is decide if you want to go ahead with your purchase – if your answer is yes, then you can go ahead and arrange for the funds to be transferred to CAAT.

Earn: After the funds have been transferred and the purchase is complete, CAAT will send you a confirmation letter, and the pension you will receive in retirement will have INCREASED!

A good pension matters, but an even bigger pension is a delight. Learn more about your purchase options and decide if a pension purchase is right for you by visiting our website or attending our special purchase webinars.