Planning your retirement

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planning your retirement

Understand your options

Whether you’re almost 65 and ready to retire, in your 50s and can’t resist the prospect of retiring early, or simply have questions about what you’ll get from the CAAT Pension Plan, we’re here to help you understand your options.

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Your top questions answered.

How much will my pension be?

One of the advantages of belonging to a Defined Benefit pension plan like the CAAT Plan is that, since your pension is based on a formula, you can predict your approximate pension income and identify the best time for you to retire.


How much will my DBprime pension be?

In DBprime, your lifetime pension is calculated using a formula that’s based on your highest average pensionable earnings, all your pensionable service, and your age. Once you retire, your pension is paid for the rest of your life.

Calculating your pension

The variables in this formula are: a) your earnings, b) your years of pensionable service, and c) your age at retirement. Your age and pensionable service determine if your pension is reduced or unreduced.

DBprime annual pension formula

1.3% x highest average earnings to AYMPE x pensionable service


2% x highest average earnings above AYMPE x pensionable service

DBprime annual bridge benefit formula

If you retire before age 65, you receive an additional payment called a bridge benefit. The bridge benefit is paid every month until you turn 65.

0.7% x highest average earnings to AYMPE x pensionable service

Definitions of terms

Highest average pensionable earnings (HAPE)

These are your earnings during the 60 consecutive months that your pensionable earnings were highest. This design ensures your pension is calculated based on your best earnings.


The Average of the Year's Maximum Pensionable Earnings. The YMPE is the first earnings ceiling on which you contribute to the Canada Pension Plan (CPP). The AYMPE is based on your year of termination or retirement and is calculated using the YMPE for that year and each of the previous four years.

Pensionable service

The total of the years and months that you contributed to the pension plan. The longer you contribute to the Plan, the higher your pension will be.

How much will my DBplus pension be?

Your DBplus pension is calculated using a formula, so you know what your annual pension will be when you retire. The pension formula is divided into two components:

  1. Guaranteed annual base pension (payable from age 65)
  2. Average Industrial Wage (AIW) Enhancements

Guaranteed annual base pension

The promised pension earned in the current year, calculated at the end of each year you contribute. Guaranteed annual base pension uses your total contributions and your employer's contributions on your behalf. The formula uses a pension factor as a multiplier to calculate your pension. It is set based on the Plan’s Funding Policy and is currently 8.5% of member and employer contributions.

For the pension you earn starting January 1, 2025, the annual pension factor will be 9.5%. Read more about this change. Trying the DBplus pension estimator? This change is already reflected in its pension projections.

8.5% x year’s total contributions* = your guaranteed base pension for that year

*Note that the year’s total contributions are the member's plus your employer’s contributions on your behalf.

AIW enhancement

This is the amount added to your total CAAT Pension earned in previous years. It is applied at the start of each year in which you are a contributing member, subject to the Plan's Funding Policy, and is based on the announced increase to the Average Industrial Wage (AIW) index.

The AIW index represents wage inflation in Canada, which has averaged about 2.2% over the past 20 years.

AIW enhancements, once added, become a permanent part of your promised pension. That means that the AIW enhancements are cumulative – each year’s enhancement is paid on top of the previous year’s total pension, plus enhancements.

DBplus past promised benefits** x AIW enhancement rate

**Past promised benefits accrued to the end of the previous year, including any past AIW enhancements

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Pension Estimator

These easy-to-use estimators help you plan for retirement. First, choose the estimator that's right for you, then enter some basic data to estimate your projected pension amounts.


When can I retire?

Did you know that seventy percent of Canadians retire earlier than originally planned? The number one reason for these early retirements is health-related. The CAAT Plan’s early retirement options give you flexibility and security to retire when the time is right for you, and provide a level of comfort in case you have to retire sooner than planned.

In the CAAT Pension Plan, you can retire when the time is right for you. As a member, you have a range of retirement dates to choose from - you can retire from as early as age 50, up to the year you turn 71.

Retiring at age 65

The default retirement date is age 65. It is referred to as the "normal retirement date," and it is the last day of the month in which you turn 65. At age 65, your lifetime pension is unreduced, no matter how much or how little service you have. If you choose to retire when you reach age 65, it’s referred to as a "normal retirement".

Your pension continues to grow if you keep working after age 65.

Retiring before age 65 - early retirement

If you retire before age 65, you will be taking "early retirement" and your pension may be reduced. 

Early retirement under DBprime

If you retire early, you receive your lifetime pension, plus an additional payment called the bridge benefit, which is payable until you turn 65.

Your early retirement pension will be either unreduced, or reduced

Unreduced pension

You qualify for an early unreduced pension in DBprime as soon as you reach one of these "magic numbers":

  • 85 Factor: Your age + pensionable service = 85 or more
  • 60/20 Rule: You are at least 60 years old with at least 20 years of pensionable service

Reduced pension

If you do not qualify for an early unreduced pension, your pension and bridge benefit will be reduced. The reduction factor is 3% per year (0.25% per month) for each year you are away from the earliest date you are eligible for an unreduced pension (prorated by month). This is a permanent adjustment to your pension payment and your bridge benefit.

Early retirement under DBplus

Reduced pension

Under DBplus, you can retire at age 65 with an unreduced pension, or retire as early as age 50, with an early start adjustment. The adjustment rate varies from 3% to 5%, based on the Plan’s funding level. Initially, the reduction rate for retirements has been set to 3% for each year you are under age 65. The actual rate will depend on the Plan terms in effect at your retirement.

Different early retirement provisions apply to members who start their pension after being deferred members. Read Starting your deferred pension to learn more about these provisions.

Retire after 65 - postponed retirement

If you continue to work beyond age 65, your retirement date is postponed. Your pension keeps growing as long as you are working and contributing to the Plan. By law, you must start your pension by December of the year you turn 71, even if you choose to continue working.

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Your retirement planning guide

Planning your retirement and collecting a pension from the CAAT Pension Plan

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Different early retirement provisions apply to members who start their pensions after being deferred members. Learn about the early retirement provisions that apply.

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