Unlocking Your Pension Benefit

  • Unlocking your pension benefit refers to the ability to withdraw (receive as cash or make a tax-sheltered transfer to an unlocked retirement savings product, such as an RRSP) the entire amount of your locked-in pension benefit.
  • Unlocking cannot occur while you are an active member of a pension plan (while you are employed and contributing to the pension plan or while you are considered a member based on the plan’s provision) or if you are in receipt of a pension from a Defined Benefit Plan. If you are a member of a Defined Benefit Plan, depending on the plan rules, you may not be eligible to transfer your benefit out of the pension plan after early retirement age (which is generally age 55).  Please contact your pension plan administrator if you have questions about the rules for your pension plan
  • To unlock your pension benefits, you must first have terminated membership in your pension plan and electing to transfer your benefit out of the plan, or you have previously transferred your pension benefit into a locked-in retirement savings arrangement.
  • If your pension plan provisions allow for it, the Pension Benefits Act, 1997 allows you to unlock your entire benefit and receive a lump sum if either:
    • a doctor certifies that you have a considerably shortened life expectancy; or
    • your pension balance is determined to be a small balance.
  • Please contact your pension plan administrator regarding your potential eligibility for either exception noted above.
  • If you are the owner of a locked-in retirement savings arrangement, you can unlock the entire benefit and receive a lump sum for one of the following reasons:
    • a doctor certifies that you have a considerably shortened life expectancy;
    • the value of money held in all your locked-in retirement savings arrangements is determined to be a small balance;
    • you have been a non-resident of Canada for two consecutive calendar years; or
    • you are experiencing certain circumstances of financial hardship.