final needs planning

Elephas Group – Understanding the Recent Changes to the Canadian Pension Plan

Elephas Group helps loved ones cope at a time of loss, by helping assure they are in a position of financial security. As an extension of our commitment to aiding families with the professional advice we offer, we have highlighted some of the important changes coming to the CPP.

Are you worried that the money you are contributing won’t be enough for retirement, ar the shrinking death benefits the CPP is paying out? If so, this article will be very relevant to you.

Recently, the Globe & Mail published an article that broke down some of the changes to the Canadian Pension Plan (CPP) announced by Canada’s Minister of Finance, Bill Morneau.

The new CPP Enhancement will see an increase the amount paid into the plan, and subsequently a higher amount of CPP income one receives.

The Government of Canada has made these changes to address the worry of 1.1 million middle-class Canadians who have been unable put away enough money for retirement. Many have been critical of the CPP becoming more and more disconnected from its original purpose of supporting the futures of Canadian workers and retirees. Additionally, many are concerned that the CPP hasn’t been able to keep up and evolve with Canadians nowadays.

Important things you should know regarding the CPP

  • When eligible CPP contributors die, a one-time, lump-sum, taxable death benefit payment is made to their estate.
  • The death benefit payout has shrunk considerably in recent years.
  • With people paying more into their CPP, the shrunken death benefit will still remain the same.
  • The outdated CPP death benefit isn’t able to cover the cost of modern funerals.
  • According to Service Canada the average death benefit payout as of July 2013, was $2,282.50.

How do I become more informed?

For those considering planning for the “what if?” scenarios that life offers, you need to know you have the financial security in place. For aspiring retirees, the best thing to do is research how the CPP is going to work for you in the future. You can read a detailed overview of the CPP on the Government Canada website here.

For more information about planning for the future, planning funerals in advance, and other important information, please refer to the Elephas Group Blog. You can also contact one of the consultants at Elephas Group to learn more about the Final Needs Planning Program™


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