Leaving Your OMERS Employer? Too Young to Retire?

October 15, 2013
Did you know that you can keep your pension with OMERS and get a future stream of retirement income for life?
OMERS options for your future benefit include an OMERS pension or transferring the commuted value (CV) of your pension out of OMERS to a prescribed savings vehicle, such as a locked-in retirement account (LIRA).

Keeping Your Pension With OMERS

  • Your pension is paid for life. You will not outlive your pension. (The average OMERS member retires at age 62 and receives a pension for 25 years.)
  • Your pension is based on your salary and years in the OMERS Plan at the time you leave your OMERS employer – the amount can be estimated in advance and is not affected by investment returns or market turbulence.
  • Your OMERS pension is indexed for inflation.
  • Your OMERS pension includes survivor benefits (your eligible spouse will receive a survivor pension, indexed for inflation, for life).
  • You will be able to continue to invest in the OMERS Fund with Additional Voluntary Contributions (AVCs).

Transferring the Commuted Value (CV)

  • The CV is the lump-sum value of your pension that would have been paid by OMERS (including indexing and survivor benefits) based on the prescribed interest rates in effect when calculated.
  • The Income Tax Act limits what you can transfer, tax-sheltered, out of OMERS. Any excess is paid in cash, and tax will be deducted.
  • You become responsible for its investment.
  • When it's time to draw retirement income from your LIRA, your options include:
    • An annuity to provide a monthly payment for life. The monthly amount will depend on your age, the benefits you choose and market conditions at the time of purchase.
    • A life income fund (LIF) which allows you to withdraw different amounts each time (subject to the legislated annual minimum and maximum), but you are still responsible for its investment. Your money continues to be tax-sheltered until it's withdrawn.

Making the Decision

What you do may not be a pension-only decision. Some employers provide retiree healthcare benefits and eligibility for these benefits can be linked to your pension.

Before making a final decision, we recommend that you consult an independent financial adviser – someone who has nothing to gain from your decision. Ask them to compare your OMERS benefits with what the investment would provide under various investment and economic scenarios. We can also help. Visit the Members section to learn more about your pension.