Improvements to the handling process of clients who are 71 years old

We are excited to announce the upcoming enhancements to our Age 71 handling process. This change is set to be implemented this month (July 2023). This initiative will track members with registered retirement savings products who are turning 71 years old. Members are no longer eligible to contribute to registered products in their plans after December 31st in the year they turn Age 71. 

This will lead to a more consistent approach to prevent new contributions from being deposited into registered accounts.   

What's Changing?

Moving forward, there will be communications shared with clients three times a year (end of March, end of September and mid-November). These shared pieces will identify members turning age 71 in the same year.

Furthermore, programming has now been built to track and reject contributions in the last five business days of the year for age 71 members. The year-end deadline for 2023 is December 20. This rule also applies to spouses with registered assets who turn 71.

The same goes for rejecting any future contributions to registered products for members who turned age 71 in prior calendar years.

If contributions are received for these members, they will be rejected and refunded to the plan sponsor. If clients continue to send these contributions, Sun Life will invoice them our standard correction fee (for a minimum of one hour).

If a sponsor misses the five-day business day deadline for stopping contributions to members turning age 71, there are other options: 

• Direct contributions to a non-registered savings plan (if the plan permits this),
• Direct contributions to the employee’s spousal RRSP (if the plan permits this and the spouse is not over the age of 71), or
• Explore other payroll options, such as paying final contributions in cash or doubling up on final member contributions in an earlier pay period.

Questions?

Please reach out to your Sun Life Representative