Helping you prepare for the future
Initially established in 1955, The Canadian Mental Health Association Pension Plan is a defined contribution (DC) plan where contributions are made to each individual employee’s retirement account and upon retirement, the value of this account funds the employee’s pension.
A board of twelve trustees, appointed by the CMHA National Board, administers the plan. The functions of the trustees are laid out in the Trust Deed. The plan is subject to the federal Income Tax Act and regulated by the Ontario Financial Services Regulatory Authority (FSRA). Under these regulations, it is known as a Multi Employer Pension Plan (MEPP), and at least six of the trustees must be members. The plan's accounts are audited by an external accounting firm annually.
There are currently 41 employers participating in the plan, which is open to all branches and divisions of CMHA. Employers make contributions to the plan at a minimum rate of 4.5% of an employee’s salary, and up to a maximum of 18% (taking into account contributions to an RRSP). There are no mandatory employee contributions required, although they may make additional voluntary contributions, subject to the 18% limit.
Contributions are submitted to the plan’s custodian, Sun Life, and employees then advise as to how their contributions should be invested. Investment instructions are set when the employee enrolls in the plan and can be updated at any time. Various trustee-approved investments are available, ranging from money market accounts to fixed income (bond) funds to various Canadian, American and other foreign equity funds. The performance of the various funds is reviewed on a regular basis.
When employees retire, they purchase an annuity with their accumulated contributions and investment earnings. They may purchase the annuity from Sun Life or any other financial services company.