Pension Life - Winter 2021
Your 2021 COLA is 0.5 per cent
Effective January 1, 2021, you received a cost-of-living adjustment (COLA) of 0.5 per cent. The COLA matches the annual change in the Canadian consumer price index (CPI) in the 12-month period up to and including September 30, 2020.
If you retired partway through 2020, your COLA will be pro-rated based on the number of months in 2020 you received a pension.
Teachers’ Pension Plan rules allow us, the Teachers’ Pension Board of Trustees, to grant an annual COLA up to the annual percentage increase in the CPI. While not guaranteed, COLAs help maintain the purchasing power of your pension. Once granted, a COLA becomes part of your basic pension and, if applicable, your bridge benefit and temporary annuity for as long as you receive them.
Your pension is safe and secure
You have no doubt been concerned about your health and the health of loved ones during the pandemic. You may also have concerns about the health of your pension.
We want to assure you that your pension is safe and financially well positioned to withstand market downturns.
How do we know this? The plan’s most recent valuation (a measurement of the plan’s funding position) showed the plan was 102.5 per cent funded. This means the plan has more than enough to pay all current and predicted future pensions. Also, the plan’s 10-year returns up to the end of 2019 (the most recent annual figures available) were 9.1 per cent, exceeding the investment goal of 6 per cent.
Your plan has been through many crises in its nine decades: the 1987 market crash, the collapse of the dot-com bubble in 2000 and the financial crisis of 2008–2009, as examples. Over time, the economic challenges caused by the pandemic will also pass.
We hope that knowing your pension is safe and secure provides some peace of mind.