For most Canadians, retirement is a time to take their foot off the gas, enjoy life and finally pursue passions they never had the chance to do when they were working and raising kids. But what is the retirement age in Canada, and can I retire early?

What age can you retire in Canada?

There isn’t a mandatory age for retirement in Canada, but you can receive pension benefits from age 65. You can receive the Old Age Security pension from 65, but payments can be delayed for up to five years until age 70. The longer you wait, the larger your monthly payments. You can collect the Canada Pension Plan between the age of 60 and 70.

CPP and Old Age Security pension eligibility ages

If you start your CPP before age 65, your payments will be reduced by 7.2% each year. For example, receiving your CPP at age 60 will result in a 36% reduction compared to waiting until age 65. However, if you wait until after you are 65, your benefits will increase by 8.4% every year you hold off. So, if you collect your pension at the age of 70, you will receive 42% more money.

If you decide to delay taking your OAS pension, you will receive an additional 7.2% each year you wait (up to the age of 70).

Guaranteed Income Supplement (GIS) eligibility ages

If you receive the Old Age Security (OAS) pension, have a low income and are 65 years or older, you may be eligible for the Guaranteed Income Supplement (GIS), a monthly non-taxable benefit.

The average retirement age in Canada

According to Statistics Canada for 2021, the average retirement age in Canada is currently 64, but it varies depending on gender and type of employment.

  • Average age of all retirees: 64.4
  • Average age of male employees: 64.9
  • Average age of female employees: 63.8
  • Average age of all public sector employees: 62.4
  • Average age of all private sector employees: 64.8
  • Average age of all self employed workers: 67.6

What age can you retire in Canada?

Retirement age depends on factors like government pension and benefits, whether you have a workplace pension and any personal savings like RRSPs, TFSAs and investments. If you want to maintain or achieve a certain standard of living, you might need to retire later (or save more money).

How to retire early in Canada

To determine if you can achieve early retirement in Canada, use a retirement calculator to estimate how much you will need to save. If you want to retire early in Canada but are not sure how, speak to a financial planner for advice on what steps you can take.

Financial planners advise on various topics, such as retirement, investing, tax preparation and estate planning. They can also help with saving money and repaying debt.

Of course, if you reach your financial goals and achieve financial independence before retirement age, you can always retire earlier. This will require more discipline, sacrifice, and planning. Retiring early usually means utilizing personal savings, investments and income streams to cover your monthly costs and live comfortably.

Ultimately, the decision about when to retire is up to you. No matter what age you choose to retire, the most important thing is to make sure you have a plan for your financial future and the tools to make your retirement dreams a reality.

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