A defined benefit pension plan offers members predictability and security because it calculates the pension amount using pensionable salary and years of pensionable service. In other words, the pension a MEPP member will receive is not based on investment growth or how much they have paid into the Plan over time.
MEPP also offers pension options to best suit members' unique retirement needs.
With MEPP, once members are vested in the Plan and eligible to retire, they will know how much money they will receive each month.
Typically, members become vested in the Plan once they have earned five years of pensionable service, but this timeline can be affected by:
- Transferring from another pension plan;
- Turning 65 while still being an active member in the Plan; and
- Joining the Plan after age 65.
If a member is not vested and they remove their funds from MEPP after leaving the Plan, they will receive only their contributions with interest. Vested members who leave MEPP before turning 55 years of age have the option of waiting to receive a lifetime pension or taking a lump sum payout based on the commuted value (CV) of that pension.