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The Pension Benefit Standards Act (“PBSA”) allows members to transfer the value of their locked-in pension benefits from their pension plan to a LIF as early as age 50. A LIF contract provides the flexibility of managing your investment and also determining your annual benefit withdrawal amounts. The CRA sets the minimum annual amount which must be withdrawn from your LIF account and the Pension Benefit Standards Regulation (“PBSR”) sets the maximum amount.
The maximum annual withdrawal from a LIF is prescribed by the Pension Benefits Standards Regulation (“PBSR”). This amount varies according to your age, current long-term interest rates and the previous year’s investment return for the fund. Your financial institution should be able to calculate your annual minimum and maximum withdrawal amounts.
If your pension funds are held in a LIRA, you may transfer money to a LIF or purchase an annuity at any time on or after you turn 50 years old.
The B.C. pension legislation came into force on January 1, 1993. Since you terminated your membership in the plan prior to 1993, the locking-in rules under the B.C. legislation would not apply to your locked-in accounts. Your pension benefits are therefore subject to the terms of the plans provisions at the time of your termination of membership. Your pension administrator should be able to tell you what your options are.