|
Retirement
Anyone?
by
Michel Plamondon
Lately I have been receiving several inquires
about retirement. In this article, I will outline the steps to be
taken in order to retire. Remember that you must meet the
eligibility requirements so make sure that you qualify.
1. Notify your employer before April 1. You should
advise your principal and you must submit an official letter of
resignation (e-mail is acceptable) to the Superintendent of the
Human Resources Department of the School Board. Verbal notification
is not sufficient. It is not essential to notify your spouse but it
might not be a bad idea because he/she will be the person most
affected by your decision. I know that my wife will need a lot of
advance notice. Verbal notification is sufficient in this case
assuming that you are still on speaking terms.
2. Write a letter (or e-mail) to your
Superintendent or the Human Resources Department of the School Board
requesting your service gratuity. You must indicate whether you
wish to receive it directly or roll it into an RRSP.
If you choose to receive it directly, it will be
taxed at source as follows: ten percent if the gratuity is less than
$5,000., twenty percent if it is between $5,000. and $15,000. and
thirty percent if it is more than $15,000. You can kiss that new
car goodbye, the tax man must get his pound of flesh.
If you decide to roll it into an RRSP, you must make
arrangements with a financial institution of your choice and the
money will be sent directly to that institution in your name. You
should be aware that $2,000. of contribution room is created for
every year of service that you have prior to 1996. If it is not
sufficient, you may use your personal contribution room.
You may opt to use a combination of these two
options.
The service gratuity is payable within thirty days of
contract termination. You may request it when you submit your
letter or resignation.
3. Contact the office of Lynne Taylor at Pension
and Benefits, PEI Public Service Commission at 368-6305 and request
the necessary forms. Five forms will be sent to you: an Application
for Superannuation, a form for direct deposit of your pension in
your bank account, two TD1 forms for income tax purposes (one for
Provincial taxes and one for Federal taxes), and an application form
if you wish to become a member of the P.E.I. Retired Teachers=
Association. A copy of your birth certificate or other proof of age
will be required. You did not think that this was going to be easy,
did you? These forms should be completed by mid-May or earlier if
possible.
4. Contact Johnson Inc. to discuss the insurance
coverage that you wish to retain. You may keep all your coverage
except the dental plan. I guess it must be assumed that retired
teachers don=t
have any teeth after chewing out all those kids. Therefore, get
your teeth cleaned, filled or pulled before you retire.
Keep in mind that the employer does not cost share
any of the retiree benefits. If you decide to drop any of the
coverage that you now have, you will not be able to get that
coverage back after you are retired.
If you are retiring at the end of the school year,
your coverage is still in force until September 30. Arrangements to
switch from the active plan to the retiree plan should be made
before the end of June because premiums are deducted a month in
advance and will be made on the September pension cheque.
If you have any questions please contact Michel
Plamondon at Federation House, 569-4157 or toll-free at
1-800-903-4157. |
