| My pension plan
(0 min 45 s)
What type of pension plan is the Desjardins Group Pension Plan (DGPP)?
What are the advantages of the plan?
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The DGPP is a
defined benefit plan, which means that upon retirement, you will receive a guaranteed pension for life. This ensures that, regardless of financial market fluctuations, you will receive a stable and predictable amount each month, providing peace of mind during your retirement.
Your retirement pension is calculated based on three key elements according to a predetermined formula. It involves a percentage multiplied by your highest average career salaries and the number of years you have participated in the plan.
Percentage | |
Average salary of the best-paid years | |
Number of credited years of service |
The calculation differs according to the following participation periods
Your main tools for calculating your pension
What are the pension calculation formulas?
The amount of your pension is determined according to the following formulas, based on the participation period.
Pension calculation
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Pension payable |
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For the participation |
Pension credit1
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Average salary
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Years of participation |
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Sum of the 3 periods, if applicable |
Before 2009
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1,3% / 2%
| x
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Best 5 years |
X |
Number of credited years of service before 2009
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=
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Pension payable at age 65 (A)
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2009 to 2012
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1,5% / 2% | x
| Best 5 years
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X
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Number of credited years of service from 2009 to 2012
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=
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Pension payable at age 65 (B) |
From 2013
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1,5% / 2% | x
| Best 8 years
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X
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Number of credited years of service from 2013
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=
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Pension payable at age 65 (C)
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Total annual DGPP pension
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A+B+C2
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1The pension credit gives a percentage (1.3% or 1.5%) of average salary up to average maximum pensionable earnings (MPE5) and 2% of average salary exceeding average
MPE5.
2The DGPP pension payable cannot be greater than the maximum for tax purposes. Amount before deduction of income tax, plus Quebec Pension Plan or Canada Pension Plan retirement pensions, Canada Old Age Security pension and other retirement income.
If, in the past, you were a member of another pension plan that merged with the DGPP, your pension for those years of membership will be determined according to the terms recognized at the time of the merger. Upon your retirement, your pension will therefore be composed of two portions: the DGPP portion and that of your former plan. (pdf - 175 ko) According to the Quebec Pension Plan and the Canada Pension Plan,
the normal retirement age is 65. The same applies to the Desjardins Group Pension Plan (DGPP). However, with the DGPP, it is possible to retire and start
receiving your pension as early as age 55, which is known as
early retirement. If you retire between ages 55 and 65, the pension amount may be reduced to allow you to enjoy your pension earlier and for a longer period.
You can also opt for retirement
after age 65, known as deferred retirement. As long as you work for a Desjardins employer, you can continue to participate in the DGPP and increase your pension, up until the end of the year following your 71st birthday.
For more information on this topic, please consult the
Retirement Age page. To facilitate a gradual transition to retirement, you might consider, with your employer's agreement, reducing your working hours and opting for
gradual retirement. If you are 55 or older, signing a phased retirement agreement will be advantageous. For more information, please consult the
Gradual Retirement page.
When you retire, you can opt for the normal pension (lifetime pension) or choose a different option (temporary pension) based on your needs.
Normal pension (lifetime pension)
Temporary pension This option allows you to receive an advance on your retirement pension to increase your income at the beginning of your retirement.
More specifically, for retirement before age 65, this option allows you to receive a
higher pension temporarily to increase your income at the beginning of your retirement, but it results in a reduction of the pension that will be paid to you for the rest of your life thereafter.
Two types of temporary annuities may be offered to you:
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• Leveled temporary pension aims to provide you with a more stable and uniform retirement income throughout your retirement. Thus, before age 65, you receive higher amounts from the DGPP. These additional incomes compensate for the government benefits to which you are not yet eligible due to your age. Starting at age 65, your DGPP pension is reduced to account for the amounts that were paid to you in advance.
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• Maximum temporary pension aims to maximize your retirement income before age 65. Thus, before age 65, you receive the highest amounts permitted by law from the DGPP. Starting at age 65, your DGPP pension, paid for your lifetime thereafter, is
significantly reduced to account for the amounts that were paid to you in advance.
Temporary annuities are interesting options when retiring and can help you achieve your retirement plans.
However, to make informed choices, since these options affect your income until your death, it is important to set up a comprehensive financial plan tailored to your situation with a financial advisor.
At your retirement, if you have a spouse according to the applicable definition of the DGPP, this person must be designated as such. Upon your death, they will be entitled to a pension of at least 60% of your pension. However, this person can waive their rights by completing a form included in the retirement documents.
For the pension accrued before 2013
If you have a spouse at the time you retire, the normal form of the pension is called a lifetime pension,
60% joint and survivor, guaranteed for 10 years.
This means that:
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• Your pension is paid for life.
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• In the event of your death, 60% of the amount of the pension you were receiving will be paid to your spouse identified at the time of your retirement. The pension will be paid to them for life.
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• If you and your spouse die before the end of the 10-year guarantee period, your beneficiaries will receive the present value of all payments your spouse would have been entitled to until the end of the 10-year guarantee period. This amount will be paid in a single payment.
If you do not have a spouse at the time you retire or if this person waives their rights, the normal form of the pension is called a lifetime pension, guaranteed for 15 years.
This means that:
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• Your pension is paid for life.
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• In the event of your death before the end of the 15-year guarantee period, your beneficiaries will receive the present value of all payments you would have been entitled to until the end of the 15-year guarantee period. This amount will be paid in a single payment.
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For the pension accrued since 2013
The normal form of the DGPP pension is the same
regardless of your marital status. Whether you have a spouse or not at the time you retire, the normal form of the pension is called a
lifetime pension, guaranteed for 10 years.
This means that:
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• Your pension will be paid for life.
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• In the event of your death before the end of the 10-year guarantee period, your beneficiaries will receive the present value of all payments you would have been entitled to until the end of the 10-year guarantee period. This amount will be paid in a single payment.
Note that if you have a spouse at the time you retire, the law requires choosing a pension that is
at least 60% joint and survivor to the spouse. The amount of the normal pension is then reduced to account for the reversibility. Your spouse can also waive their rights. You can then opt for a
lifetime pension, guaranteed for 10 years.
At retirement, in December of each year, you will receive a letter informing you of the percentage of indexation of your pension for January 1st of the following year. -
• For the pension accrued before 2013: Your pension will be increased each year according to the Consumer Price Index, up to a maximum of 3%, starting from January 1st following your retirement.
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• For service since 2013: Your pension will be increased each year according to the Consumer Price Index, up to a maximum of 1%, starting from January 1st following your 65th birthday or the beginning of the year following your retirement if it starts after age 65, for a period of 10 years. A prorated amount applies in the first and last year of indexation.
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• Your pension is paid monthly by direct deposit into your account.
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• The payment is made on the day corresponding to your retirement date (except for retirements between the 29th and 31st of each month, for which payments are made on the 28th of each month). If the payment date falls on a Saturday, Sunday, or public holiday, the payment will be made on the preceding Friday or the preceding business day.
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• The first payment includes retroactive payments from your official retirement date.
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• Your pension is taxable. Tax withholdings will be made on your pension based on income tax rates. If you wish to modify the tax withholdings, you can do so from your secure online file or by contacting Member Services.
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• At retirement, in December of each year, you will receive a pension update letter. This letter will include the indexation of your pension for the following year, if applicable, and the new amounts payable to you before and after applicable taxes.
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Use the pension simulator to estimate your DGPP pension at different retirement dates.
You will also see the pension options that may be offered to you. Temporary pensions providing an advance on your retirement income between ages 55 and 65 may be available. |
To learn more:
To establish a comprehensive financial plan tailored to your situation, contact your advisor at the caisse.
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