1. What is the Deferred Annuity?

The deferred annuity under the Canadian public service pension plan is a lifetime pension calculated as 2% of your average salary multiplied by your years of service, with payments deferred until age 60.

2. How Does the Calculator Work?

The calculator uses the standard annuity formula:

Where:

• Average Salary — Your highest consecutive 5 years of pensionable earnings
• Years of Service — Your total years of pensionable service
• 2% — The accrual rate for the pension plan

Explanation: The formula calculates your annual pension amount that would be payable starting at age 60.

3. Importance of Annuity Calculation

Details: Understanding your potential deferred annuity helps in retirement planning and financial decision-making for Canadian public service employees.

4. Using the Calculator

Tips: Enter your average salary in CAD and years of service (can include half years). All values must be valid (salary > 0, service years between 0-50).

5. Frequently Asked Questions (FAQ)

Q1: What counts as pensionable earnings?
A: Generally your salary, but may exclude certain payments. Check with your pension plan administrator for specifics.

Q2: Can I receive this annuity before age 60?
A: Early retirement may be possible with reduction factors. The standard unreduced pension starts at age 60.

Q3: Is this amount indexed to inflation?
A: Most Canadian public service pensions include cost-of-living adjustments after retirement.

Q4: Are there maximum limits to the pension?
A: Yes, there are maximum pension limits under Canadian tax law (currently around $3,400 per year of service).

Q5: Does this include bridge benefits?
A: No, this calculator shows only the lifetime pension portion. Some plans include temporary bridge benefits until age 65.