knowledge topics
Foundations of Pension Plans
KNOWLEDGE EXPECTED OF: Both CFP® Professionals and QAFPTM Professionals
- Identify the types of pension plans available in Canada.
- Public Pension Plans
- Registered Pension Plans (RPP)
- Identify the public pension plans that exist in Canada.
- Canada Pension Plan (CPP)†
- Old Age Security Pension (OAS)††
- Provincial/Territorial Pension Plans
- Define types of Registered Pension Plans.1
- Defined Benefit (DB) Pension Plan
- Defined Contribution (DC) Pension Plan†††
- Identify the parties to a registered pension plan.
- Pension plan member - employee
- Pension plan sponsor - employer
- Pension plan administrator / trustee
- Pension plan committee
- Explain the role of each of the parties to a registered pension plan.
- Explain the party who assumes the risk associated with a pension entitlement.
- Identify the party who makes the investment decisions related to a pension.
- Explain the pension contribution arrangements associated with registered pension plans.
- Mandatory
- Voluntary
- Contributory
- Non-contributory
- Define vesting.
- Explain the attributes of a registered pension plan, such as:
- Allowable contributions
- Vesting provisions
- Retirement benefits
- Survivor benefits
- Transferability of benefits
- Termination options
- Identify the events that may lead a registered pension plan member to contemplate their benefit entitlement, such as:
- Retirement
- Divorce/separation/relationship breakdown
- Termination of pension plan membership
- Termination of employment
- Death
- Termination of the pension plan
- Explain the entitlements of a registered pension plan member upon termination of plan membership.
- For a non-contributory plan in which the plan member is vested
- For a contributory plan in which the plan member is vested
- For a non-contributory plan in which the plan member is not yet vested
- For a contributory plan in which the member is vested
† Information on the Canada Pension Plan (CPP) is found in the Government Benefits section of the Technical Knowledge.
†† Information on Old Age Security is found in the Government Benefits section of the Technical Knowledge.
††† Pooled Registered Pension Plans (PRPP), Deferred Profit Sharing Plans (DPSP) and Specified Pension Plans (SPP) are all considered defined contribution pension plans, however have been covered under their own sections given their crossover nature between defined contribution pension plans and registered retirement savings plans.
Glossary of Verbs (mouse over to see definition)
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Define
To state exactly the meaning of
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Identify
To be aware of / to recognize and correctly name / to locate an appropriate resource
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Explain
To make clear the meaning of / to describe something in more detail or reveal relevant facts or ideas related to it
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Compare
To note the similarities and differences between two or more things
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Estimate
To determine an approximate value for
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Calculate
To find the value using mathematics
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Convert
To change from one form or purpose to another
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Evaluate
To reach a conclusion or make a judgement through careful study
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Interpret
To give the meaning of / to construe or understand / to translate orally
Read more about the Taxonomy used in the FP-BoK
