CPP payment and start-age calculator

Almost nobody gets the maximum

This is the single most useful thing to know before planning around a number.

The maximum at 65 is $1,507.65 a month. The average new recipient at 65 receives $877.01 — about 58% of it. That gap is not an anomaly; it is the normal case.

The maximum requires contributing at or above the year's maximum pensionable earnings for essentially your whole working life. Years spent studying, raising children, unemployed, self-employed at low income, or working outside Canada all pull the figure down.

Planning a retirement around the maximum when your history is average overstates your income by roughly $7,500 a year.

Your Statement of Contributions in My Service Canada Account gives your actual estimate. Use that figure in the field above rather than either published average.

Break-even is not the whole question

The arithmetic of break-even is simple: take less for longer, or more for less time. In nominal dollars, starting at 60 rather than 65 typically pays more until somewhere around age 74, and waiting to 70 rather than 65 pays more from around 82 onward.

But break-even assumes the only thing that matters is the total collected, and that is rarely true.

Money received at 60 can be invested, or can allow you to leave an RRSP untouched to compound. Money received later is inflation-indexed for longer. And CPP income affects the OAS recovery tax and can eliminate GIS entirely — interactions that can dwarf the CPP difference itself for a lower-income retiree.

Health and family longevity matter more than the arithmetic. Someone in poor health rarely reaches any break-even age.

GIS makes early CPP expensive for low-income retirees

This is the interaction that most often reverses the usual advice.

The Guaranteed Income Supplement is income-tested and reduces steeply — roughly fifty cents of GIS for every dollar of other income. CPP counts as that other income.

So for someone who will rely on OAS and GIS, taking CPP early can mean losing about half of it to reduced GIS, while permanently accepting the 36% reduction. Deferring CPP in that situation keeps GIS higher during the deferral years and produces a larger, less heavily clawed-back pension afterwards.

For higher-income retirees the relevant interaction is the OAS recovery tax instead.

If GIS is likely to be part of your retirement income, model the two together rather than deciding on CPP alone.

The formula

The adjustment is exact arithmetic applied to your amount at 65.

The 0.6% and 0.7% figures apply per month, not per year, so a partial year counts. Starting at 63 years and 4 months is 20 months early, which is a 12% reduction rather than being rounded to a whole year.

Break-even here is nominal — no discounting, no indexation, no tax. Adding any of those moves the crossover, generally in favour of starting earlier, because a dollar today is worth more than a dollar at 82.

Terms on this page

Statement of Contributions

Service Canada's record of your CPP contributions and pensionable earnings, with an estimate of your pension. Available in My Service Canada Account and the only authoritative figure for you.

Post-Retirement Benefit

An additional lifetime benefit built by contributing while already receiving CPP. Mandatory under 65, optional between 65 and 70.

General drop-out

The provision excluding up to eight years of your lowest earnings from the base calculation, which raises the pension for people with interrupted careers.

Break-even age

The age at which two start-age choices have paid the same total. A nominal figure that ignores tax, indexation and investment returns.

Common questions