For most teachers, most of their pension revenues will come from their private retirement plan: RREGOP.
CARRA, the administrator of RREGOP, set up a page answering common questions to help in the retirement decision-making process, which includes a pension estimator. A more exhaustive guide is also available (en français). Major points are summarized below.
Calculation of your pension – RREGOP (Government and Public Employees Retirement Plan) provides a pension of 2% of gross pay for every year of pension contributions to a maximum of 76% (38 years). This maximum will be gradually increased to reach 80% (40 years). Gross income equals the average salary of the five (5) best earning years.
Eligibility – You will be entitled to your pension without reduction, provided you meet one of the following eligibility requirements:
- age 60 or over (regardless of the number of years of service);
- at least 35 years of pension service (regardless of your age).
If your last day of work is July 1st, 2019, or after, the first requirement changes from 60 to 61. An additional eligibility requirement will be added: age + years of service add up to 90, if you are age 60 or above.
Actuarial reduction – If you don’t meet any of those two eligibility requirements, you can still retire and start collecting pension provided you are at least 55. In this case, however, your basic pension must be reduced permanently by 0.33% for each month of anticipation (4% a year). After July 1st, 2020, the penalty increases to 0.5% per month (6% a year).
Coordination of the RREGOP with the Québec Pension Plan – When you turn 65, your pension plan will take into account the fact that you also receive a pension under the Québec Pension Plan (QPP), which will cause a reduction of your RREGOP pension. This is what is called the QPP Coordination.
The reduction will be applied to your pension as of the month following your 65th birthday.
More details here.
A buy-back of RREGOP pension credits – If you are considering a buyback (redemption of service) for RREGOP examine the section on the RREGOP’ page dealing with buy-back. You can do your own calculation of the cost by using CARRA’s Redemption Cost Estimator (uses 260 days as the annual basis of pay).