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"My Private Dream" thread......coulda swore it was about Reserve Pension
Its the same thing isn't it??
TM
Its the same thing isn't it??
TM
Reserve Pension- Merged
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Thanks for the reply and info DAP.
I know understand that the debate is not about the differences that currently exist, but about the differences in the "old" system vs the "new" system.
I know understand that the debate is not about the differences that currently exist, but about the differences in the "old" system vs the "new" system.
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Just to confuse the matter, if that Sgt Reserve was buying back e.g. 19 years Reserve time plus 2 years Reg F time, they would pay 7% CI on the Reserve time and 4% SI on the Reg F time, all in the same buyback calculation. As DAP stated it would not matter if the buyback was on joining the Reg F or remaining in the Reserves, the buy back would be the same, but how the buy back time is calculated (the rate of interest) is different.
Do you really think DND has come to their senses and realized that 7% CI is loan sharking?
Do you really think DND has come to their senses and realized that 7% CI is loan sharking?
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I finally got a response... a generic one at that.
"You're file is currently put in queue in order to be calculated. We are trying to get through the files in the fastest time possible, however, the priority files are the members who are currently released or who will be releasing within the next month. Once your file has been completed, you will be notified. If you have any further questions, please do not hesitate to contact priorpensionableservicearrears@forces.gc.ca."
Note the bolded email address. I didn't know about that one.
"You're file is currently put in queue in order to be calculated. We are trying to get through the files in the fastest time possible, however, the priority files are the members who are currently released or who will be releasing within the next month. Once your file has been completed, you will be notified. If you have any further questions, please do not hesitate to contact priorpensionableservicearrears@forces.gc.ca."
Note the bolded email address. I didn't know about that one.
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Has anyone actually seen a Pension Gnome? I'm planning a stealth visit - I expect to find a Wizard of Oz Situation - an old guy behind a curtain playing many voices.
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I have been following this forum for about a year now. Felt compelled to register and respond after reading this posting and similar others.
I retired from the Reserve in October 2007. Sent in my election for buyback in June of 2007 (26 years Reserve - 1981 to 2007 and 22 months Reg Force-1969 to 1970). After much to and fro communication with the pension people over the last 14 months I finally spoke to a real person about 1 1/2 months ago. I was told that my file was in the "fourth and final stage" and they would get back to me. 1 1/2 months later after no response, I emailed the person and received the following information, "My apologizes for not having contacted you sooner. Although your file has not been audited as of yet.......
Needless to say I am somewhat upset and confused. I wrote back to them and asked them, "I do wonder...if I am at stage 4 in this process what was done in stages 1 to 3?" If I haven't even been audited, what have they been doing with my file for 14 months?
"begbie" states in his post, "You're file is currently put in queue in order to be calculated. " I suppose mine is in there with it. I must say, the lack of timely and accurate information is depressing. Don't even get me started on the cost of those 22 months of Reg Force time and how it will essentially gut my reserve pension is I don't elect to buy them back.
Hope this post isn't too redundant. I just needed to vent but at the same time maybe this will help someone who is just looking for information.
I retired from the Reserve in October 2007. Sent in my election for buyback in June of 2007 (26 years Reserve - 1981 to 2007 and 22 months Reg Force-1969 to 1970). After much to and fro communication with the pension people over the last 14 months I finally spoke to a real person about 1 1/2 months ago. I was told that my file was in the "fourth and final stage" and they would get back to me. 1 1/2 months later after no response, I emailed the person and received the following information, "My apologizes for not having contacted you sooner. Although your file has not been audited as of yet.......
Needless to say I am somewhat upset and confused. I wrote back to them and asked them, "I do wonder...if I am at stage 4 in this process what was done in stages 1 to 3?" If I haven't even been audited, what have they been doing with my file for 14 months?
"begbie" states in his post, "You're file is currently put in queue in order to be calculated. " I suppose mine is in there with it. I must say, the lack of timely and accurate information is depressing. Don't even get me started on the cost of those 22 months of Reg Force time and how it will essentially gut my reserve pension is I don't elect to buy them back.
Hope this post isn't too redundant. I just needed to vent but at the same time maybe this will help someone who is just looking for information.
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A Classic story of crappy service - my work email has several of these "final stages of audit - shouldn't be too much longer" lines.
What I can`t figure out is this part of the benefits world and you`d think they`d have an iron clad process in place
What I can`t figure out is this part of the benefits world and you`d think they`d have an iron clad process in place
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FoidedWings,
Do not understand your comment re the cost of your 22 months Reg F time circa 1969/70. One of the changes when the Reserve Pension CIF was that you can only buy back 35 calender years. That means buy back 2007 to 1972 or in your case 1981.
Do not understand your comment re the cost of your 22 months Reg F time circa 1969/70. One of the changes when the Reserve Pension CIF was that you can only buy back 35 calender years. That means buy back 2007 to 1972 or in your case 1981.
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Hi Rifleman
When the online calculator was first put up it would only let you enter 35 years back..1972. So when I first submitted my election I didn't even consider my Reg Force time. My pension was going to cost me $63,000 for a benefit of $13,000 per year - not bad returns. Then several months later I heard some rumors that got me thinking so I contacted Pension Services again and ended up talking to one of the calculator programmers. Turns out it's not 35 calendar years, it's 35 years of service = pensionable time. In the instructions for the online calculator it now states,"This is because the years you were not a member of the CF do NOT count towards the 35-year maximum pensionable years." In addition, the calculator now allows entries before 1972. Cost to me for those additional 22 months.....$90,000!! Extra pension benefit to me ....$3,369.71 per year!
So now I'm faced with a $153,000 bill for approx $16,000 per year pension. If I choose to pay only for the reserve time ($60,000) that's only 2/5 of $153,000, so...I only get 2/5 of $16,000......$6,4000!!!!! There goes my Reserve pension...GUTTED!
So I suck it up and pay the bill...and I do it in a lump sum because you can bet that I'm not going to give them one cent more than I have to. I'm only 60 years old and I plan on living long enough to suck back every penny and more...indexed!...even if I have to get my husband to pickle me so I will last longer.
When the online calculator was first put up it would only let you enter 35 years back..1972. So when I first submitted my election I didn't even consider my Reg Force time. My pension was going to cost me $63,000 for a benefit of $13,000 per year - not bad returns. Then several months later I heard some rumors that got me thinking so I contacted Pension Services again and ended up talking to one of the calculator programmers. Turns out it's not 35 calendar years, it's 35 years of service = pensionable time. In the instructions for the online calculator it now states,"This is because the years you were not a member of the CF do NOT count towards the 35-year maximum pensionable years." In addition, the calculator now allows entries before 1972. Cost to me for those additional 22 months.....$90,000!! Extra pension benefit to me ....$3,369.71 per year!
So now I'm faced with a $153,000 bill for approx $16,000 per year pension. If I choose to pay only for the reserve time ($60,000) that's only 2/5 of $153,000, so...I only get 2/5 of $16,000......$6,4000!!!!! There goes my Reserve pension...GUTTED!
So I suck it up and pay the bill...and I do it in a lump sum because you can bet that I'm not going to give them one cent more than I have to. I'm only 60 years old and I plan on living long enough to suck back every penny and more...indexed!...even if I have to get my husband to pickle me so I will last longer.
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FoldedWings, I did not take in account broken service. You are correct. Thoes 22 months should be at 4% SI. Also you have to buy back all or a percentage of the total. You cannot pick and choose. Therefore they calculate the buy back on all of your service and that amount remains fixed. Then you decide to buy back i.e. 50/65/80/100 % of that fixed cost.
Did you read previously how much my buy back cost in interest?
Did you read previously how much my buy back cost in interest?
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Sorry Rifleman, I should have said that I had about 11 years between service. There are a number of things you mentioned in your email that interest me.
You wrote. "Those 22 months should be at 4% SI." I wrote to Pension services and complained about that very thing. Why am I buying back Reg Force time at Reserve Force prices. I was answered with the following, "the difference in the final pension benefit amounts is due to the time (1969-1970) in which your Regular Force Service took place and the compounded interest which needs to be applied to it. " So there you go, the reason I am buying back Reg Force time at compound interest is because I am buying back Reg Force time at compound interest. In other words, they didn't answer my question at all. They just restated it.
You wrote,"Did you read previously how much my buy back cost in interest?" I went back over the posts and saw where you said that your interest payments were in the neighbourhood of 1/4 million dollars. Mine would be about $50,000 on the extra $90,000 alone for 22 months service. You can see why I'm determined not to let that happen.
When I was re-reading your posts I saw that you had a cost increase of nearly 21,5% from your original buyback estimate. Could you give me some idea of what caused that to happen? When I spoke to the guy who wrote the calculator program, he told me that if your entered figures are correct the calculator gives a very close statement of the amount you owe for buyback. I would sure hate to think my actual cost might be higher, especially for those 22 months.
Thanks for your comments on this. They are very helpful. My local Reserve unit has told me that so far they haven't heard of even ONE person who has started receiving their Reserve pension. I'm looking for some good nerws for a change and hoping I might find it here.
You wrote. "Those 22 months should be at 4% SI." I wrote to Pension services and complained about that very thing. Why am I buying back Reg Force time at Reserve Force prices. I was answered with the following, "the difference in the final pension benefit amounts is due to the time (1969-1970) in which your Regular Force Service took place and the compounded interest which needs to be applied to it. " So there you go, the reason I am buying back Reg Force time at compound interest is because I am buying back Reg Force time at compound interest. In other words, they didn't answer my question at all. They just restated it.
You wrote,"Did you read previously how much my buy back cost in interest?" I went back over the posts and saw where you said that your interest payments were in the neighbourhood of 1/4 million dollars. Mine would be about $50,000 on the extra $90,000 alone for 22 months service. You can see why I'm determined not to let that happen.
When I was re-reading your posts I saw that you had a cost increase of nearly 21,5% from your original buyback estimate. Could you give me some idea of what caused that to happen? When I spoke to the guy who wrote the calculator program, he told me that if your entered figures are correct the calculator gives a very close statement of the amount you owe for buyback. I would sure hate to think my actual cost might be higher, especially for those 22 months.
Thanks for your comments on this. They are very helpful. My local Reserve unit has told me that so far they haven't heard of even ONE person who has started receiving their Reserve pension. I'm looking for some good nerws for a change and hoping I might find it here.
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Okay - judging by some of the last posts, I am beginning to understand this 4% SI vs 7% CI issue.
Not trying to be a pain on this or open up any great debate, but I was wondering if anyone has any concrete knowledge as to why the buyback of the years is treated differently?
As I understand it, if someone is "buying back" his/her Reg Force time, it means that they have already received a return of contributions on what they put into the pension system in the first place - therefore effectively making them a "non-contributor" since they took their buyout. So here comes little Johnny Reservist who has been on class B for the last 20 years (full-time) and thus being a non-contributor all along (not necessarily by his/her own doing) and he/she is getting burned on a higher interest rate!!!!! Did I miss something in the "perks" column on the CF Recruiting poster for joining the Regular Force? (sarcasm over)
I apologize for my ignorance on this, but I just don't see why there should be a difference in what type of time is being bought back - time is time - and 365 days in uniform is 365 days in uniform Reg or Reserve!
Not trying to be a pain on this or open up any great debate, but I was wondering if anyone has any concrete knowledge as to why the buyback of the years is treated differently?
As I understand it, if someone is "buying back" his/her Reg Force time, it means that they have already received a return of contributions on what they put into the pension system in the first place - therefore effectively making them a "non-contributor" since they took their buyout. So here comes little Johnny Reservist who has been on class B for the last 20 years (full-time) and thus being a non-contributor all along (not necessarily by his/her own doing) and he/she is getting burned on a higher interest rate!!!!! Did I miss something in the "perks" column on the CF Recruiting poster for joining the Regular Force? (sarcasm over)
I apologize for my ignorance on this, but I just don't see why there should be a difference in what type of time is being bought back - time is time - and 365 days in uniform is 365 days in uniform Reg or Reserve!
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I've read the thread, but am still confused a bit. (I know that's normal for me) However I just wanted to make sure I understand the process correctly so please bear with me.
As I currently understand the process, we're buying back our time at 7% CI. Once we've decided to buy back our service and we decide to make payments, is the interest on the "loan" we're receiving still 7%, or is it 4% CI? Or am I totally out to lunch and it's something different.
At the end of the day I'm trying to decide to pay my amount in a lump sum, or would it be better to make the payments and invest the lump sum instead.
However I just wanted to make sure I understand the process correctly so please bear with me.As I currently understand the process, we're buying back our time at 7% CI. Once we've decided to buy back our service and we decide to make payments, is the interest on the "loan" we're receiving still 7%, or is it 4% CI? Or am I totally out to lunch and it's something different.
At the end of the day I'm trying to decide to pay my amount in a lump sum, or would it be better to make the payments and invest the lump sum instead.
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Harris said:I've read the thread, but am still confused a bit. (I know that's normal for me)
As I currently understand the process, we're buying back our time at 7% CI. Once we've decided to buy back our service and we decide to make payments, is the interest on the "loan" we're receiving still 7%, or is it 4% CI? Or am I totally out to lunch and it's something different.
At the end of the day I'm trying to decide to pay my amount in a lump sum, or would it be better to make the payments and invest the lump sum instead.
To add to the confusion... I understand that 7% CI is used to determine the amount of the buyback. Then on top of that, 4% SI is added from the date you elect to the date that you make your lump sum payment.
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Geo, yes "FWIW the 7% CI was mandated by the treasury board... not DNDs idea", BUT DND agreed with it !!! Who on the negotiating team from DND was in the Reserves?" Who was looking after Reserve interests? Who in the Reserve community was consulted? The negotiating team, to the best of my knowledge, was Reg F and Public Service. Do you think they gave a darn about 7% CI vice 4% SI? Name the CF Leadership Principals that have been violated by several senior CF officers.
Harris, try going back around Reply 604 in June "Note that after you make your election, you pay 4% COMPOUND INTEREST on what you owe. Not 4% Simple Interest. On my outstanding buy back that 4% Compound Intrest translates to 6.36 % from the TD Canada Trust Mortage calculator. I took the amount I owe, repayable over 20 years and it comes out to almost the nickle of what I pay monthly. The rate includes a mortally charge".
Harris, try going back around Reply 604 in June "Note that after you make your election, you pay 4% COMPOUND INTEREST on what you owe. Not 4% Simple Interest. On my outstanding buy back that 4% Compound Intrest translates to 6.36 % from the TD Canada Trust Mortage calculator. I took the amount I owe, repayable over 20 years and it comes out to almost the nickle of what I pay monthly. The rate includes a mortally charge".
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begbie,
PM to you.
PM to you.
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begbie, I would like to know more about your remark that, "4% SI is added from the date you elect to the date that you make your lump sum payment." That is disturbing. In my case I put my election in in June 2007 and am still awaiting "auditing" of my election. I am going to pay it all in a lump sum. Why should I have to pay interest on anywhere from 12-18 months that they have been sitting on my application. After all, I was ready to give them the money last year. It's not my fault they weren't ready to take it!
The reason I decided to go with a lump sum is because I figured out that it would cost me almost $12,000 per $20,000 over 20 years. That's major money. I talked to my bank about investment returns vs lump sum and they did some figures and said it would be well nigh impossible to make that kind of interest If I just kept the money and paid my own pension it would be all gone in 10 years. Rifleman had some very good comments about the advantages of trying to buy the maximum pension in the least amount of time.
Enough to give a person a major ulcer. By the time they are done with me I will be ready to go after a medical pension as well!!
The reason I decided to go with a lump sum is because I figured out that it would cost me almost $12,000 per $20,000 over 20 years. That's major money. I talked to my bank about investment returns vs lump sum and they did some figures and said it would be well nigh impossible to make that kind of interest If I just kept the money and paid my own pension it would be all gone in 10 years. Rifleman had some very good comments about the advantages of trying to buy the maximum pension in the least amount of time.
Enough to give a person a major ulcer. By the time they are done with me I will be ready to go after a medical pension as well!!
