Phased retirement bridging a gap

Can I get an advance from my future pension benefit? HR professionals might hear this question frequently from staff in the coming years as the boomers retire.
By Andrew Donelle
|CHRR, Guide to Pensions & Benefits|Last Updated: 06/27/2001

The advent of phased retirement plans allows older employees to keep working while semi-retired. Pension legislation first in Quebec and now in Alberta allows employees to tap into their pension benefits and receive a yearly lump sum payment. This compensates for the reduction in earning while they only work part-time.

When the employee retires, his accrued pension benefit is reduced to take into account the “advance” lump sum payments that he received from the company pension plan. This practice is commonly referred to as a “phased retirement” program or “transitional” retirement. Many provinces are studying the Quebec initiative but have not yet amended pension standards laws to permit similar phased retirement options.

How it works