Canada Pension Plan

prl prl at ozemail.com.au
Fri Feb 20 07:40:15 EST 2015


My pension as an Australian Government employee* was similarly 
disconnected from my actual contributions.

My contributions simply added to a multiplier on my average salary over 
the last three years of my employment. When multiplied together, that 
gave a value that I could take as a lump sum at retirement, or I could 
apply an age-based multiplier to the lump sum (or part of it) to convert 
to an indexed pension for life.

I never tried to account for any of it within Gnucash (when I entered my 
income into Gnucash, it already had my pension contributions deducted). 
But I did have spreadsheets to help me work out when I wanted to retire. 
:-)

Peter

* There are several schemes, this is just the one I happened to be in.

On 20/02/2015 16:07, Edward Doolittle wrote:
> Thanks, that's helpful. What I'm taking away is that despite the word
> "pension" in the title of the program, the CPP is more like a tax than a
> pension plan, in that the benefit is largely unpredictable and out of my
> control. I treat tax as an expense, so I should treat CPP as an expense as
> well.
>
> Furthermore, if I want to do retirement planning well, I need to take data
> out of GnuCash and put it into another application like a spreadsheet, and
> combine that data with data from other sources such as the ServiceCanada
> web site. I can't do everything in GnuCash. (Too bad.)
>
>
> On 19 February 2015 at 22:42, Cam Ellison <cam at ellisonet.ca> wrote:
>
>> On 19/02/15 06:01 PM, Phil Longstaff wrote:
>>
>>> I think treating the CPP as an asset is really the best you can do,
>>> because
>>> it is not an asset you own. It is a government program you pay into, and
>>> then when you retire, the government pays you based on your salary over
>>> your working life. It's not your asset.
>>>
>>>   Treat it as an expense, and do not show the asset.  As Phil says, it's
>> not your asset.  It's deferred salary, in a sense. If you want to do
>> retirement planning, it's better to use a spreadsheet and download the data
>> from your account on the ServiceCanada website, and then dump the relevant
>> data from Gnucash to the spreadsheet using a report.  CPP payments change
>> year-to-year because of inflation and for other reasons over which you have
>> no control and cannot predict (for example, if you and your spouse divorce
>> and your spouse claims part of your CPP I doubt you'd have sufficient
>> information to predict how the payment would change).
>>
>> Yes, I'm Canadian, and I run a business and have had to deal with all of
>> the above plus the employer contribution part of it.
>>
>> Cheers
>>
>> Cam
>>
>>
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