The Government of Nova Scotia has amended pension regulations to allow greater flexibility for people to withdraw from locked-in pensions when facing financial hardship.

“A number of people in the province will benefit from these amendments, which will help Nova Scotians in need pay their mortgages, rent and healthcare costs,” says Finance and Treasury Board Minister Diana Whalen.

Before these amendments, Nova Scotians had to be at or below a yearly income of $21,000 to qualify for early access to their pension funds on the basis of low income.

These updates will increase the yearly income of eligible participants to $35,000, permitting greater flexibility for withdrawals.

The maximum amount that can be withdrawn each year has been increased to $26,250 from $21,000. In addition, the updates will raise the net amount that can be withdrawn from a locked-in pension in a year to 50% of the year’s maximum pensionable earnings, up from the current 40%.

The new amendments also allow rental eviction to be considered a condition for unlocking of a pension.

Nova Scotia first passed provisions respecting financial hardship as part of the Pension Benefits Regulations in 2007.

This allowed members of pension plans to access their retirement savings if they were faced with a reduction in their incomes, incurred medical expenses not covered by another program or faced a mortgage foreclosure.

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Copyright © 2020 Transcontinental Media G.P. Originally published on benefitscanada.com

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