Facebook post that is all wrong, but still circulated as the truth

Very Misleading (Wrong) Viral Post About CPP Thanks to Stacey for this. The original rant is in Italics and the correction is normal font

Some guy wrote a thing about CPP, but he thinks CPP is OAS or something and about 80,000 people have shared his post. Everything he claims in his rant is incorrect, so I figured I would set the record straight and like 8 people will share it and I will make a huge difference. My comments and correct figures are in BOLD.

OLD AGE PENSION QUIETLY CHANGED TO FEDERAL PAYMENT BENEFIT

The Old Age Pension cheque is now (or soon will be) referred to as a "Federal Benefit Payment?" This is what Social Security (USA) changed its name to and has nothing to do with Canada. I'll be part of the one percent to forward this. I am forwarding it because it touches a nerve in me, and I hope it will in you. Please keep passing it on until everyone in our country has read it.

Your note being shared 80,000 times and your complete lack of correct information in your post touches a nerve in me.

The government is now referring to our Old Age Pension cheques as a "Federal Benefit Payment." This isn't a benefit.

It is our money paid out of our earned income! Not only did we all contribute to our pension, but our employers did too.

It totalled 15% of our income before taxes.

Old Age Security is a benefit for all Canadians who live in Canada for at least 10 years after 18 and has nothing to do with how much you paid into it. He is talking about CPP (The Canada Pension Plan) and employees and employers paid 4.95% of their salary, so a total of 9.9%/year. This year (2019) it is going up to 5.10% (10.2% Total)

If you averaged $30K per year over your working life, that's close to $180,000 invested in a pension.

You don’t pay anything on the first $3,500 you make, so if we assume a working career is 40 years and the person made $30,000/year, then the number is now $104,940.

If you calculate the future value of your monthly investment in a pension ($375/month, including both you and your employer's contributions) at a meagre 1% interest rate compounded monthly, after 40 years of working you'd have more than $1.3+ million dollars saved!

So, now the savings for this person are $219/month for 40 years and the actual value if that person got a 1% rate of return would be:

$219/month = $129,293

$375/month = $221,394 (he’s just a little off)

Unless he thinks a meagre interest-rate is above 12%/year. I’d be pumped if I could find a way to make it so my clients could easily turn a small monthly investment into $1.3 million so easily.

This is your personal investment. Upon retirement, if you took out only 3% per year, you'd receive $39,318 per year or $3,277 per month.

Now, let’s use the real numbers and keep his sweet rate of return of 1% and assume a person needs money from 65 – 90.

$221,394 = $834/month (not indexed to inflation, which CPP is)

$129,293 = $487/month (not indexed to inflation again)

That's three times more than today's average Old Age Pension benefit of $1,230 per month.

(WHO AKES $1,230 MONTH??) NOT MY PENSION!!

Someone who made over 30,000 for the years between 18 and 65, minus their worst 8 earning years would get CPP of $1,230/month.

Once again, he is talking about CPP. OAS pays out $601.45/month to anyone who has lived in Canada for 40 years after turning 18.

It is not even close to 3 times what CPP pays. Someone who made $30,000 their working life would get about 55% CPP due to not fully funding it, so they would be entitled to about $677/month, but that would go up every year as their dollars become worth less over time, plus they would get $601.45/month from OAS.

And your retirement fund would last more than 33 years (until you're 98 if you retire at age 65)! I can only imagine how much better most average-income people could live in retirement if our government had just invested our money in low-risk interest-earning accounts.

No it wouldn’t

Instead, the folks in Ottawa pulled off a bigger "Ponzi scheme" than Bernie Madoff ever did. They took our money and used it elsewhere. They forgot (oh yes, they knew) that it was OUR money they were taking. They didn't have a referendum to ask us if we wanted to lend the money to them. And they didn't pay interest on the debt they assumed. And recently they've told us that the money won't support us for very much longer.

CPP is not invested or managed by the government. A private team of portfolio managers invest this money on our behalf and try to make safe, but good returns in order to keep the plan solvent. The government can’t just borrow money out of this fund. It is well invested and there were concerns after the 2008 financial crisis, but the plan appears to be in good shape for the time being. You can google it and find out how and where the money is invested and who handles the money.

But is it our fault they misused our investments? And now, to add insult to injury, they're calling it a "benefit", as if we never worked to earn every penny of it.

Again, that’s an American term and when and where did they misuse our Pension Fund?

Just because they borrowed the money doesn't mean that our investments were a charity!

Let's take a stand. We have earned our right to our pensions. Demand that our MP's bring some sense into our government.

You will get the CPP amount you are entitled to and if you’re destitute in retirement, you will get GIS (Guaranteed Income Supplement) too.

Find a way to keep Old Age Pension going for the sake of that 92% of our population who need it.

It is still going, and they are enhancing it because most Canadians don’t save enough for themselves.

Then call it what it is: Our Earned Retirement Income.

It’s called the “Canada Pension Plan.”

99% of people won't SHARE this. Will you?

0% of people should have shared your message, because it was full of completely incorrect information. However, I think like 80,000 shared it, so that’s good news.

Just because someone goes on a rant on Facebook about something that makes you feel anger, doesn’t mean that person has their facts straight. Unfortunately, this person’s message got a lot of traction and it would have been a lot better for Canadians if it didn’t.

Thanks for reading.