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NLIS 1
July 12, 2000
(Government Services and Lands)


Ernest McLean, Minister of Government Services and Lands, is pleased to advise that the proposed changes to locked-in retirement funds have been approved effective July 1, 2000.

These changes to locked-in retirement funds will provide retirees under age 65, with a small pension income, the option to increase the amount of income received from their locked-in funds to approximately $15,000 per year.

In addition, individuals with only a small balance (approximately $3,700 prior to being eligible to retire and approximately $15,000 after being eligible to retire) in all their locked-in accounts will be permitted to withdraw the entire balance.

Financial institutions will also be permitted to provide a locked-in a retirement income fund (LRIF) similar to those allowed in several other provinces. This product will provide retirees with a yearly income limit equivalent to the rate of return of the fund, and does not require a conversion to a life annuity at age 80.

Minister McLean said: "These changes will be welcomed by many seniors who take early retirement. The changes provide a good balance between the need for retired persons to have a pension for life and the need to have an adequate income until they are eligible for Old Age Security and Canada Pension Plan Benefits."

For further information relating to these changes or to receive a copy of the directives please contact Julian McCarthy, Manager of Pension Benefit Standards at (709) 729-6014 or by e-mail at jmccarth@mail.gov.nf.ca.

2000 07 12                     12:00 p.m.


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