Insured Pension Transfer Strategy

Insured Pension Transfer Strategy

• Client Profile
  • Recently retired or downsized from employer, with option to transfer-out DBP / DCP pension plan, and/or severance package.
  • Desire or requirement to not draw pension funds as income yet.
  • Alternatively, desire to preserve the total (commuted) value of the pension as a lump sum for spouse/children/charity/estate/etc.
  • Desire for eventual guaranteed income stream.
• Solution Opportunity
  • Compare options of leaving pension with employer vs transferring it out, based on assumed RORs with guaranteed and/or segregated fund investments.
  • Upon transfer, funds invested in portfolio until time to draw down. At that point, or shortly thereafter, funds are used to purchase annuity.
  • Prior to annuity purchase, and perhaps at time of pension transfer, life insurance is secured for amount of current or anticipated value, to preserve same for estate.
  • Severance monies will also be transferred at this time, either via retiring allowance provisions, direct to RSP as a contribution, or as taxable income, staggered.