Locked in and Locked Out
April 27, 2010 7:40 PM Subscribe
I need to get access to my RPP but keep getting denied. Please hope me!
I currently have a RPP that was setup through Manulife Financial. It was setup with a former employer that I left in July, 2008. I was already vested in the plan when I left so all funds in there belonged to me. Its current value is approx. $10400.
Since that time, I've run into financial problems, especially with not working enough and have gotten myself into a rather dire financial situation. I am looking for additional employment but currently am underemployed. (For the month of April, I will have worked 10 days at most). I had applied earlier this year for a financial hardship withdrawal through the Financial Services Commission of Ontario but was denied because the RPP was still being held by my former employer. I have no understanding of financial products but I need to be able to get a hold of this money to get my life back on track.
My question is, what is the quickest way to gain access to the funds? Should I just roll it over into a LIRA or LIFF and then reapply for a financial hardship withdrawal through the Ontario Financial Services board? Can I roll the money over into a money market account and pull it out of there? I don't want to remove all the funds but enough to get my life straightened around and give myself some more security.
Personal details: Female, 35 yrs old, living in London, ON, CAN. Throwaway address: financialwoes@hotmail.com. Thanks for your help.
I currently have a RPP that was setup through Manulife Financial. It was setup with a former employer that I left in July, 2008. I was already vested in the plan when I left so all funds in there belonged to me. Its current value is approx. $10400.
Since that time, I've run into financial problems, especially with not working enough and have gotten myself into a rather dire financial situation. I am looking for additional employment but currently am underemployed. (For the month of April, I will have worked 10 days at most). I had applied earlier this year for a financial hardship withdrawal through the Financial Services Commission of Ontario but was denied because the RPP was still being held by my former employer. I have no understanding of financial products but I need to be able to get a hold of this money to get my life back on track.
My question is, what is the quickest way to gain access to the funds? Should I just roll it over into a LIRA or LIFF and then reapply for a financial hardship withdrawal through the Ontario Financial Services board? Can I roll the money over into a money market account and pull it out of there? I don't want to remove all the funds but enough to get my life straightened around and give myself some more security.
Personal details: Female, 35 yrs old, living in London, ON, CAN. Throwaway address: financialwoes@hotmail.com. Thanks for your help.
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Under Ontario law, if you are vested when you leave your job (but not retiring), you can either (a) leave your accrued pension in the pension plan and take the pension when you actually do retire or (b) can transfer the money out of the plan into a locked in account (unless you are already eligible for early retirement under the plan).
But it's not clear to me whether this person has already made this decision once, and wants to change their mind, and pick (b), when they already told the company (a).
Even though I know more about it than anybody here, I'm not really the world's expert on Ontario pension law (that would be somebody in Toronto) - so I don't know if the company has to allow somebody to change their mind once they have already made a choice. I suspect, however, that once you've made the choice, that's it, and you can't go back, unless the company wants you to be nice and let you out.
So, I'm not sure how long it would take - probably a week or so, as a guess.
If the money can get into a LIRA, the province of Ontario will allow some of it to be unlocked under certain conditions, as the questioner seems to know.
http://www.fsco.gov.on.ca/english/PENSIONS/unlocking/
This process is very quick.
posted by kmennie at 3:14 PM on April 28, 2010