Friday, June 28, 2013

Early Retirement and collecting CPP

There are many milestones in a persons life - getting your drivers license, finishing school, getting your first job, buying your first car - and the list goes on. Eventually, as you get older, the list changes - you start looking forward to retirement and benefiting from that pension that you have paid into for so many years.

Since we finished work in February 2012 we have been counting down the months, and then days, until Pat hit one of those milestones - qualifying to start collecting his CPP (Canada Pension Plan). This is a Pension Plan that Canadian workers pay into throughout their employment (through an employer or self employed). Generally speaking, you would start collecting this pension when you turn 65 years of age. However, there is a provision for you to start collecting your CPP at age 60 - the only catch is that the pension is paid out at a lower rate.

When we were calculating how we could retire early we decided that Pat would start collecting his CPP early and so 6 months before his 60th birthday we applied for this benefit. We mailed in the application while we were still in León and hoped that the package would make it's way to Canada and then on to Service Canada. It is possible to file the application electronically, however you are still required to print, sign and mail in a copy of your signature. We figured we might as well send in the whole application together.

After not hearing from Service Canada for some months we were beginning to wonder if Pat's application had been received, and then one day we received notification that his application had been approved. The letter indicated that the final monthly payment would be calculated the first month after the month that he turned 60 and that we would be notified of how much the payments will be. With direct deposit we have no worries about not receiving the payment.

Are you looking for information about collecting your CPP? Here is the link to the Service Canada website: CPP Info