STEP-BY-STEP. Congratulations! STEPS RETIREMENT GUIDE. You are retiring soon START THE PROCESS OFF RIGHT GETTING STARTED

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1 -BY-STEP RETIREMENT GUIDE You are retiring soon Congratulations! STEPS Retirement is an important milestone in one s life. You ve no doubt been planning and thinking about it for some time. Now, it s time to put those plans into action! Over the next few months you ll be making a lot of important decisions about your Air Canada pension and your overall financial security for this period of your life. To make the Air Canada retirement process easier, this simple guide will take you through each required action, step by step. START THE PROCESS OFF RIGHT GETTING STARTED YOUR AIR CANADA RETIREMENT KIT MAKING YOUR PENSION ELECTION COMPLETING AND RETURNING DOCUMENTS YOUR FIRST PENSION PAYMENT

2 01 START THE PROCESS OFF RIGHT Make sure you choose your retirement date carefully. Your age and years of service have a big impact on the amount of your pension benefit. You have tools at your disposal to help you understand the factors that impact your retirement decision, such as our video series on retirement, your most recent annual pension statement, our pension calculator or you can call HR Connex Pension at (select Option 2) for additional help. Once you ve chosen your date, notify your manager and start the retirement process two to three months before you want to stop working (you cannot begin this process more than three months ahead of time). Two to three months will give both you and Air Canada enough time to get everything in place for a smooth transition and you ll receive your pension without delay! STEP 1 - FOR PILOTS ONLY Air Canada requires pilots to notify the Company as well as HR Connex Pension of their intention to retire. Depending on the position held, advanced notice, which ranges from 6 to 10 months, is required to ensure proper pilot staffing at all times. Failure to do so may have negative consequences. In order to determine their retirement eligibility, pilots are requested to communicate with Flight Operation Management. Three months prior to their planned retirement date, they will be contacted by HR Connex Pension to start the Air Canada retirement process, as described in the steps below. WATCH AND LEARN Before you start the retirement process, it s a good idea to watch or re-watch our video series on retirement. It will help you understand how to apply for retirement, the factors that impact the amount of your pension, and will provide information about post-retirement health benefits, life insurance and travel privileges. Go to acaeronet and click on HR Connex. Under the retirement section, click on Planning for retirement. ONE EASY NUMBER TO SERVE YOU BETTER When should I call HR Connex Pension versus HR Connex? What s the difference? The answer depends on the information you are inquiring about or want to share with Air Canada. OPTION 1 HR CONNEX OPTION 2 HR CONNEX PENSION OPTION 3 MANULIFE Dial toll-free and select the option that s right for your situation Report a change of: Address Phone number Banking information for direct deposit Ask questions regarding: Your health benefits and life insurance Report the death of a spouse Your deductions on your pension payments (income tax, benefits, tax credits) Ask questions about the pension plan or about the retirement process Initiate the retirement process (instead of doing it online) Make your retirement pension elections Speak with a Retirement Specialist Ask questions pertaining to the calculation of your gross pension amount or spousal death benefits If you have questions about your participation in a Defined Contribution (DC) pension plan. 2

3 02 GETTING STARTED Once you ve decided when you want to retire, there are two ways you can advise us of this and continue the process. You can switch between these at any time. For example, you can start online and then switch to a live person if you run into hurdles. You ll pick up the process right from where you left off and carry on from there. BY PHONE through HR Connex Pension at (select Option 2) Call and ask to speak with an HR Connex Pension Retirement Specialist. A dedicated specialist will be your single point of contact for the entire process regarding your pension. He or she will work with you using this guide and accompany you until you retire. Working With a Retirement Specialist A Retirement Specialist will be dedicated to you and will record all your pension elections over the phone, help you complete and return any required paperwork, and help you understand: How to pick a retirement date that maximizes the pension you ll receive from Air Canada; What your pension payment options are; How to update information on your eligible spouse and/or your beneficiary; The forms and information you ll receive in the mail about your pension; What actions and steps you ll need to take and when; And more! Your dedicated Retirement Specialist s job is to make the process easy, convenient, and hassle-free and to make sure that you retire with peace of mind. ONLINE through the HR Connex Pension Web site Acaeronet Click on HR Connex then, under the Retirement section, click on HR Connex Pension. You can start the retirement process online using the Retire Now link. The site will take you through the process, step by step. Do-it-Yourself with Web-Based Tools and Information The HR Connex Pension Web site allows you to complete the entire retirement process online. The site also provides detailed, personalized information about your Air Canada pension and easy-to-use modeling tools that will help you make decisions about your pension options. 3

4 03 YOUR AIR CANADA RETIREMENT KIT Once you have initiated your retirement by phone or online, you ll receive your personalized retirement kit, with documents that will help you make your pension elections. Review these carefully with your eligible spouse, if you have one. We also recommend that you consult your financial advisor. The retirement kit includes your: Retirement Kit Introduction, including the important dates to start your pension payments Pension Payment Option Descriptions, which explains how each pension payment option is paid out, and corresponding survivor benefits Pension Calculation Statement, which shows your potential pension payments depending on the pension option you elect Pension Elections Worksheet, which will help you record your election and other important information when it s time to communicate with HR Connex Pension GETTING YOUR SPOUSE involved in the process The decisions you make about retirement will affect you for the rest of your life. If you have a spouse, it s important to share with him/her as much information relating to your retirement income as possible. Although we hope for the best, it s good to prepare for any situation in which your significant other may be called on to manage your affairs, either temporarily or upon your death. In the event of your passing, your spouse should contact HR Connex to report your death (not HR Connex Pension since it affects other aspects such as your Air Canada benefits). The HR Connex representative will ask for details that will be transmitted to the Benefits & Pension teams. Doing this as early as possible will help your spouse avoid having to refund any pension overpayments. 4

5 04 MAKING YOUR PENSION ELECTION Once you ve reviewed the documents in your Retirement Kit, it s time to make your pension election. Once again, you can do this either by phone with your Retirement Specialist, or online. Remember, you can switch between the phone and online options at any time. Here is the information you ll be asked to provide when you make your election: Your pension payment option and the pension amount for the option chosen. Your banking information, so Air Canada knows where to deposit your pension. Any additional tax withholdings. HELP US KEEP IN TOUCH You ll be receiving important pension information throughout the retirement process and after you retire. Make sure Air Canada has at all times: > Your personal address > Your latest home mailing address > An updated phone number where we can easily reach you Note: The Air Canada pension plans are an important part of an employee s retirement income. As such, Air Canada has the responsibility to make sure that the appropriate benefits are going to the correct retired members. Every year, a sample representing approximately 20% of pension recipients (including surviving spouses) is randomly selected and sent a pension audit form. In the future, if you or your surviving spouse receives this form, simply complete the form and return it as instructed to avoid any inconvenience. 5

6 05 COMPLETING AND RETURNING DOCUMENTS Within a few days after you ve made your election regardless of whether you did so through your Retirement Specialist or online you should receive the Pension Election Confirmation Form to fill out. Review the form to make sure your pension election and personal information are correct. Keep a copy for your records. Sign and date the Pension Election Confirmation Form and other required documents as noted in your Retirement Kit. Keep a copy for your records. Send the original signed Pension Election Confirmation Form to HR Connex Pension before the deadline shown on your form, by mail or fax, including: Proof of age Proof of marital status (marriage certificate or affidavit) and proof of your spouse s age (if applicable) A void personalized cheque or direct deposit slip You must sign, date and return the Pension Election Confirmation Form for your pension payments to begin! IMPORTANT DATES TO START YOUR PENSION PAYMENTS The deadline shown on your form is to ensure that you start receiving your pension on the first day of the month following the date of your retirement. You should send back your duly-completed Pension Election Confirmation Form and required documents by this date. If you miss this deadline by a few days, you ll still start receiving your pension but there will likely be a delay. However, if you miss this deadline by more than a month, your election will be considered cancelled. You will have to contact HR Connex Pension to start a new retirement process from the beginning. 6

7 06 YOUR FIRST AIR CANADA PENSION PAYMENT If you follow all the steps carefully and send in the paperwork on time, you will receive your first pension payment on the first day of the month following the date of your retirement, but it will represent two months worth of pension payments*. For example, if you retire July 1 and have returned all the necessary paperwork on time, your first pension payment will be made on August 1 and will include the payment for July and August. From that point on, you will receive your pension payments on the first day of each month. * Your final pension amount or the amount you ll receive throughout your retirement may differ from the initial payments you receive to take into account any final pay adjustments. You can ask a Retirement Specialist for more information on any possible differences between these amounts. Other Retirement Income Sources to Consider Apply for Canada or Quebec Pension Plan benefits six months before your retirement date to ensure that your benefits will begin when you need them. You may begin receiving a reduced benefit as early as age 60; you ll receive full benefit if you start them at the age of 65 and upgraded benefits if you postpone them after age 65 but before age 70. Apply for Old Age Security benefits six months before the age of 65. These benefits are subject to claw-back and do not get paid retroactively (for example, if you apply at age 66, the government will not pay you one year s worth). Factor your personal savings into your retirement planning. These can include another employer s pension plan, real estate, bank accounts, RRSP, TFSA, brokerage accounts, and other investments that qualify as additional sources of retirement income. Your spouse may also be entitled to a government or other pension plan and could have personal savings. Estate planning is for everyone, not just for wealthy people. An estate plan ensures that you and your beneficiaries get the maximum value from your hard-earned money both before and after your death. With the help of a lawyer/notary and a financial advisor, gather and review all your financial records, current will, etc. and consider having a will, living trust, durable power of attorney, power of attorney for health care, and/or a living will. 7

8 POST-RETIREMENT HEALTH AND LIFE BENEFITS As an Air Canada retiree, you will continue to have access to group health and life benefits, if you meet the eligibility criteria. Below you will find a general overview of the post-retirement group benefits that you may have access to*. Life Insurance Basic & Optional - these plans will be available to you Supplementary - this plan will be available to you and your spouse Voluntary Accidental Death & Dismemberment Insurance This plan will be available to you, your spouse and your eligible dependent children Health and Dental Care A Basic Health Plan will be available for you and your eligible dependents at no cost to you. Coverage includes prescription drugs, hospital expenses and certain medical services and supplies. It does not include dental care. At retirement, you will be given the opportunity to participate in the Voluntary Supplementary Health Plan, paid for by both you and Air Canada. The plan provides more extensive coverage, including dental care, for you and your eligible dependents. You ll receive much more detailed information on these benefits and the steps you must take once you ve submitted your retirement request. * To be eligible, an employee must have at least 25 years of continuous or qualifying service, or his age plus his continuous or qualifying service must be equal to at least 80 points, or have reached age 65 and been hired prior to May 1, TRAVEL PRIVILEGES You and your spouse (at retirement) will continue to enjoy similar travel privileges that you did as an active Air Canada employee. There are no forms to complete the transition from active employee to retiree status will happen automatically! For more details, visit the employee travel site under News and Policies. BE A PIONAIR! Air Canada retirees can become members of the Air Canada Pionairs, an organization with more than 15,000 members worldwide. Their mission is to preserve our aviation heritage, maintain close friendships, foster a spirit of mutual aid, support the welfare of the membership and promote Air Canada. You can find more information by visiting 6_2018 8