Province Helping People in Need Unlock Retirement Funds
Nova Scotians will soon find it easier to unlock their retirement funds when facing challenging circumstances.
Amendments to the Pension Benefits Act and regulations will go into effect July 1. The changes will streamline the process for Nova Scotians to access locked-in retirement accounts or life income funds.
“These amendments will mean Nova Scotians experiencing financial hardship can work directly with their financial institutions to access these funds,” said Finance and Treasury Board Minister Labi Kousoulis. “This will save significant application processing time for Nova Scotians in need.”
A person may be approved to unlock a portion of their retirement accounts or life income funds based on financial hardship if they expect less than $41,067 in income over the next 12 months; if they are in default on their mortgage or rent and face possible eviction; or for medical or dental expenses.
There are limits on how much people can access because of reduced income. The 2021 maximum withdrawal is $30,800 minus 75 per cent of the applicant’s anticipated total income for the 12-month period. There is no limit on how much may be removed for default on a mortgage or rent or for medical or dental expenses.
Financial institutions will be able to directly approve applications. The $116.65 government fee to process applications is also being eliminated.
- the government passed amendments to the Pension Benefits Act during the spring legislative sitting
- the amendments are consistent with the government’s commitment to reduce red tape
- other Canadian provinces use a similar streamlined approach
- no jurisdiction in Canada permits full access to locked-in accounts
The regulations and additional information can be found at: https://www.novascotia.ca/finance/en/home/pensions/notices.aspx.html