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2024 CHANGES—Let’s Not be Fooled by the Infamous Tiny Bonus Granted Between Ages 60 and 65


La fameuse bonification entre 60 et 65 ans du RRQ

2024 CHANGES—Let’s Not be Fooled by the Infamous Tiny Bonus Granted Between Ages 60 and 65


By making our own calculations, we won’t get blindsided.

HERE'S AN EXAMPLE using real figures. Simply replace these figures with the ones provided in the letter you received from Retraite Québec to make your own calculations.

Monthly amount of disability benefits in December 2023 = $1,343.18. Based on the annual cost-of-living adjustment provided for by the QPP Act (set at 4.4% on January 1, 2024) and WITHOUT considering the recent changes made to the pension, the person should receive $1,343.18 X 1.044 = $1,402.28 per month in 2024.

Using the total pension amount indicated in the amendment letter you received from Retraite Québec for 2024, e.g., $1,425.59 (fixed disability portion of $583.29 + retirement pension of $842.30), we can now calculate the EXACT amount of the tiny bonus.

In this example, the exact amount of the bonus received considering the 2024 changes is: $1,425.59 - $1,402.28 = a hefty $23.32 per month.

Given that the Retraite Québec failed to provide all the details in its letter, we may be led to believe that the total increase of $82.41 is the bonus resulting from the 2024 changes, when in fact, the $82.41 increase represents the total of the $59.01 annual cost-of-living adjustment + the minimal $23.32 increase due to the changes.

The real increase between ages 60 and 65, due to the changes, varies from about 0.5% to 3.5% of the total pension amount, while the penalty can amount to as much as 24% of the retirement pension—for the rest of our life.

Remember that the cost-of-living adjustment is provided for by law and automatically applies to all benefits and pensions paid by the QPP at the beginning of each year.

IMPORTANT CLARIFICATION: The monthly amount of your disability benefits in 2023 and that of your blended pension in 2024 must both be gross amounts (from which no income tax has yet been deducted at the source) if you want an accurate and reliable comparison. So, don't use the amount of your monthly disability bank deposit, but rather, the gross amount before taxes. The same goes for 2024.

 


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