For those wondering about the benefit difference between PWL and other calculators, here is their response: The main difference between the PWL Capital calculator and cppcalculator.com is the YMPE growth rate assumption. CPP benefits are calculated using the average YMPE from the past 5 years. cppcalculator.com assumes that this value remains constant, whereas PWL projects YMPE growth in the future based on the wage inflation and CPI inflation assumptions, and calculates the 5 year average accordingly. This may seem like a small detail, but it can lead to significant differences in the benefit.
In the benefit, or in the benefit calculation? Because I suspect the government’s just going to use their own calculator. So theirs is the number I’m going with.
@@whatifschrodingersboxwasacofin 5 year average YMPE has moved from $57,780 in 2021 to $66,580 in 2025. Leaving this value the same going forward is definitely a flaw in doing this calculation as the rate does grow with time as shown over the last 5 years above ($8,800). If you're within 5yrs of retirement and at the top of CPP that would mean an extra $2,200 per year in your pocket. So having this as part of the calculation is going to be closer to reality. In fact whenever Doug Runchey does the calcs he explicitly states his number are all based in current years dollars (the year he does the calculations he did for mine anyway). So if you are not collecting for a few years you may get more and his numbers are inherently conservative in nature because of this. That being said the future is unknown so it really depends on one's personal preference, risk tolerance and contribution history when determining which method would be preferred. My age 65 benefit has increased $1,044/year from May 2023 to Jan 2025 (1.85year). Note I haven't worked during this time so I'm kind of thinking, most, if not all, the increase has to do with the increases in YMPE over the same time period. Also 2023 would be one of my general drop out years so income in that year doesn't have any effect on the age 65 benefit.
This still doesn't make sense. The PWL calculator lets you set both wage and normal inflation (CPI) within the tool. If you set these both to zero within the PWL tool, shouldn't the 2 tools match? What am I missing here?
Ben the results of this calculator don't match other online calculators such as Doug's cpp calculator or the calculator on the financial wiki. Your calcs show a higher number. Have you benchmarks your results against others? I set inflation to zero to align the models
This calculator is incredible. Exactly what I’ve been searching for all these years. Thanks for sharing, and hats off to Ben and the folks at PWL for giving such a helpful gift to Canadians.
Yes true, I have been in touch with a brokerage Advisor. With an initial starting reserve of $80k, my advisor chooses the entry and exit commands for my portfolio, which has grown to approximately $550k.
My CFA NICOLE ANASTASIA PLUMLEE a renowned figure in her line of work. I recommend researching her credentials further... She has many years of experience and is a valuable resource for anyone looking to navigate the financial market..
Great video and analysis. The math doesn't lie, waiting gets you more money, but the one thing this misses is taxes. Taxes are a significant concern for those of us to have a good pension or a Defined Benefit Pension with a bridge until 65. If i waited to collect CPP until 65, i would have had 11 years of non contribution. My pension is my major source of income. Its adjusted to CPI. Having started planning at a young age i have RRSPs, TFSA and cash in addition to the pension. Getting more money later means OAS clawback. Waiting until 70 works best for people who have significant RRSPs
Outstanding! thanks for sharing this calculator, confirmed my thoughts with a star/benefits age of 66 for me. Retiring at 63, RRSP/RRIF aggressive meltdown for 3 years, then CPP/OAS for final 10 years of life. Sounds pessimistic to assume i'll die before 80 - trust me - it's solid.
Great video and fantastic to have an online calculator! Having survivor benefit calculation to the online calculator would be an excellent enhancement! I have called Service Canada and had them send me projected CPP amount - 3 times. The numbers are dramatically different for each of the 3 estimates. So, my confidence level in Service Canada numbers is low.
Thanks for this video. I have used Doug Runchey's online CPP calculator, which is always touted as the gold standard, and I have now used this one. Exact same data inputted, but a significant difference in expected CPP. Per month at age 65 $1058 vs $1250 on the PWL calculator! Why such a difference?
CPP is the acronym for the Canada Pension Plan and the Canadian Retirement Income Calculator (CRIC) has been around for several years. The Retirement Hub though, is quite new.
Thanks Adam for another great video, I used the Canadian CPP calculator back in April using my CPP earnings and contribution print out from CRA and now used PWL CPP calculator and to my surprise the amounts at age 65 were exactly the same amount, retired last year at age 56, cheers!
Great video highlighting a really nice tool for Canadians. Thanks for bringing up the issue of survivor benefits. It would be great if those calculations could be included in the future.
Thanks for the video, and the calculator. Running my numbers, shows what I have long thought. That CPP isn't a great investment. If I retire at my planned age of 59 after 36 years of contributions and don't take CPP until age 65 my IRR around 2%.
what confuses me the most is getting conflicting information. I go to My Service Account > CPP and they estimate I'd get $580 / month. I go to PWL Research and use their estimator and they say $1,016 / month. I'm not trying to be deceptive, I copied my past income into PWL straight from the CPP website. It's disheartening that the two estimates are so vastly different. I fully support planning for ones future, and knowledge is power, but this is a bit much to consume.
Great tool. Thanks for this. I've always wondered what effect the drop out years would make to my expected benefit. In my case its $400/mo more that the Service Canada current projection. Reassuring.
Great tool, and thanks to Ben and Braden for making it available. However, I am not clear on how the numbers are arrived at. Compared to age 65, CPP should be 36% less at 60, and 42% more at 70, however 721 is not 36% less than 1203, and 1757 is not 42% more than 1203. Is seems the $1203 and the other numbers are future nominal dollars, but if so then the age 60 amount would be 664. Would love some clarity on how the numbers are calculated.
Great Video and Calculator. Thanks so much. I have a quick question. In my scenario, I became disabled at the end of 2005. Basically Stopped working in 2006 and have not worked since and will not until I hit 65 in January 2028. At that time my CPP disability will go to CPP at age 65. I put in the disability start when I started getting CPP disability in March 2010 but did not have any income since 2006. Was I supposed to enter 2006 for disability or is the date I began CPP disability correct? Thanks.
Adam, this is great. I have a QQ: I'm 60 this year, and have just retired. When I enter all my data, including the fact that I'm no longer contributing, the tool states that I'll get ~$1,400/month when I'm 65. *But since I won't be 65 for another 5 years, does this mean that I'll actually get $1,400 per month in 2029, or that I'll get the equivalent of today's $1,400 in 2029 (i.e. it'll be ~$1,585/month if I assume 2.5% average inflation for each of the upcoming 5 years)?* Hope this makes sense. None of these tools seem to explain this well (today vs future dollars) in their results...or at least not well enough for me to understand.
I think its in todays dollars, but you are completely right. It is confusing especially when they are asking for inflation factors to understand if that is inflating the outcome.
It does but it assumes that your recent income will continue until your regular retirement age. This may be fine and close for most people, and especially if you are near the retirement age, but it is wrong if you retire early, had many child bearing years etc.
I've tried for two hours to work the PWL calculator, and it kicks out after I'm about half way through entering my pensionable income figures. They don't always record properly and I've never been able to make it to the end before it kicks me out and starts all over again. :(
Turns out was my browser. Didn’t work on Safari, but finally worked on Chrome. All good! Not sure how to use the self employed option. I had years of both, self employed and employer employed.
Can this calculator be used if you’re already retired but are not yet collecting CPP? I retired at 60, will be 65 next year. I have a defined pension plan with a bridge until 65 and am on the fence about applying for my CPP when I turn 65.
No reason why you can't use it as you control the assumptions and can input your own retirement date and past income earnings towards CPP. I have noticed the benefit amounts are around $20 less than my CPP statements. Not sure why that is as I'm between 60 - 65 but still trying to understand the numbers this calculator generates and when assumption flags/data is changed and the impact it has on the overall numbers.
If you have a bridge ( I do) it is designed that CPP replaces the drop of the bridge at 65. If you wait until 65 one replaces the other. Then OAS is extra money. I took mine 2 months ago at 61. CPP plus OAS puts me about $4000 ahead of my current income. But in the meantime my CPP is going into my TFSA and high interest savings account. I also retired at 54 so non contribution years also played a roll. You should also consider if you wait will you run into OAS clawback. I'm getting $40,000 head start vs at 65..4 years of compounding interest
@@garth217 Not sure why people focus on the OAS clawback, it's only 15% of income above the threshold. That means for every $10K in income you forfeit $1500 of OAS but you're still getting $8500 more net income.
@pseudocynic1 for me it's not actually the money. I paid Taxes my whole life and as a default for doing OK.. I get less than the next guy..who didn't pay as high taxes I did.
@@pseudocynic1 I get your OAS clawback comment and wonder why there isn't the same level of anxiety over the Age Tax Credit loss. My only thought is because the Age Tax Credit isn't actually money lost (IE a loss of a tax credit no longer eligible for rather than an decrease in income). With OAS it is actually less money received (therefore more tangible). This being said I kind of get the issue with losing OAS more so than the age tax credit. Maybe because the income threshold for tax threshold is so low people are not near that line and could never get there anyway. But with OAS many with DB pensions or good savers it may be hard to rationalize hard saving all your life to set up your retirement only to lose a benefit whereby you probably paid higher taxes all your life as well which pays for that benefit. I dunno In the end I'm not too worried about the OAS clawback because if you set up your retirement savings in a good way whereby you can even out all your family income in 2024 you would need to have adjusted taxable family income of $182,000 to even start losing OAS funds. I wouldn't have a problem meeting our lifestyle expenses with significantly lower than that sum of annual cash.
What a great idea!!! It was VERY GLITCHY! Numbers would change constantly when I tried to input my past income. I could not get it to work. Would like to use it in the future if the software is fixed.
I noticed some of that happening as well --- I kind of chalked it up to an overflow of people using the site at once... let things settle down for a few days then try it again.
I had no issues but it could be a platform problem or browser settings. Worked for me using Windows 10/Firefox and Android 14/Firefox (both updated to latest versions).
Thanks for this very useful calculator. Is this also factoring in the YAMPE, Years additional max pensionable earnings ? I read that the CPP was going to increase quite a bit with the YAMPE. I don't see any drastic increases after the large CPP increases in 2024 & 2025. Thanks again.
Thanks for the great info., especially the tip on accessing CRA to obtain past year's T4 information. However, when I accessed CRA, it seems that they only have T4 info. for the past 10 years. How can I obtain T4 information prior years?
Its not your T4 that you need, there is a statement of contributions. Go into your My Service Canada account-Canada Pension Plan-Payments-View my contributions. That will list your lifetime CPP contributions.
Great idea. I can't get it to work though. After inputting my numbers nothing changes on the results and graphs side. They are still the numbers that were used as examples. Will try again another day.
Great tool. Thank you PWL ! I retired a few years ago, but am working part time as I approach 60. I was able to graphically see the effects of either quitting and starting cpp at 60, working until 65 but start cpp at 60 (the PRB is calculated, nice !) , or working until 65 and then starting cpp.
So then I did a little task to see the effect of working pt up to cpp start for each age from 60-65 (In other words, when I stop working, I start CPP). From a baseline at 60; At 61 I get a 12.7% increase in my forever money. At 62, its another 10.5%, 63 adds 9.1%, 64 adds 8.1%, 65 adds 6.5%. All together, it's a 46.9% increase in CPP by working pt (approx a third of ympe) and waiting until 65. Everyone's case is different, and in mine I cannot drop any of these lower income part-time years out, so the data I generated shows the effect of accumulating low income years. Comparatively- If I was to stop working at 60, but then wait until 65 to draw cpp, I only get $500/yr less than I would had I kept working until 65. Not a whole lot.
Where exactly do I find MY spreadsheet on the CRA site. I'm on it right now and I can seem to find it .... although I think I have seen it before. If someone could post a "tree" if you know what I mean of how to get there. Thanks
I retired at age 61, decided to start CPP when it hit 1k per month. Yes I could have waited, but I ran the break even age and it came close to my families life expectancy history. So the idea of leaving what CPP owes me (after taking from me my entire life) on the table makes no sense.
What assumptions did you make to determine your break-even age? For example, were your CPP payments going to be used as cash flow for living expenses or saved and invested at a specific rate of return, is there a spouse involved that will run up against the maximum payout if you predecease them or was there concern about legislative changes to the plan? We all have unique circumstances and I find it instructive to hear other people's situation. My wife and I both retired at 61 over 2 years ago and will begin drawing down our RRIFs next month to supplement our small pensions and investment income. We are fortunate in that we don't need CPP and can delay benefits for as long as we like but the trade-off between waiting to get a larger payout later or dying earlier than anticipated is difficult to judge.
Remember that RIF are taxed at 30% over $15,000. That money is withheld at source. If you have a modest pension that tax money is held by the government until the tax period..if you take it out next month like you said the government had your extra tax money until APRIL 2026. Take the money now
My understanding is this calculator is today's dollars (PV) and therefore the actual amount you receive in the future is a lot more. I put 0% in the expected inflation field and got what looks to be the actual future dollars.. is that correct?
Is Quebec the only province that send you an official estimate(starts at age 54, and updated every 2 years) as to what you will be getting if you retire at age 60 & 65 ?
Of note, the calculator does not factor in the opportunity cost of delaying CPP payments … depending on individual circumstances, some individuals may get greater personal enjoyment out of a smaller amount right now instead of waiting for a larger amount later.
This might be obvious to many, but not so much to me: would these be real (2024) dollars, or nominal dollars? I can't seem to find any information on that. If I were to set both inflation and wage inflation to 0, does that provide real dollars?
The application uses present value calculations which is why you see the amount of money your receiving after you start CPP to never change. The amount received will go up with inflation but because of inflation the present value purchasing power will not change.
If the pension income your husband is getting is considered pension eligible income you can claim the $2,000 pension credit when he transfers at least $2000 of pension eligible income to you. Search the governement web site for eligible pension and annuity income (less than 65 years of Age). There it explains the income eligible for this tax credit.
My husband will be 68 December 27th. He plans to retire in July or August 2025. He has a work pension as well. How much income tax will Revenue Canada take from his monthly CPP payment. Or do we have to take it off ourselves and how much.
taxes are not deducted from your cpp ammount. When you apply, you can choose to have a percentage held back. How much you ask to be deducted is up to you and depends on your projected retirement income.
Got the PWL program running. What is the easy way for me to view my 30 years of tax fillings to round up my CPP contributions. I attempted through "My Services Canada" but did not find what I was looking for.
CPP Earnings and Contributions on the gov't site. From that data, the 'base portion' goes into the PWL calculator under Assumptions/Earnings/Past Income.
When my mum retired and applied for CPP, she had me and my siblings sign a paper, application form, with birthdates and SIN. Basically stating she was at home raising us and not working outside the home.
@@calleycousins6622 Yes. It removes the years that mothers stay home. Basically it lowers the denominator in the calculation and increases the average.
Thank you for the vid. Sounds like a great resource but it has a few bugs. Tried to enter the yearly income and as I went through the years it would lower the past years to the default value again. Don’t know how to inform them of this. Would be good to tell the devs. They worked hard on this and probably want to know that this happens to squash the bug.
Riddle me this. Assume that you have a well paying job out of college and max out the EI CPP. Take the employee and employer contributions and apply a reasonable return rate say 5%. I might have done my math wrong, but I looking at what was in that pool and looking at 5%, comparing that to what we actually get looked atrocious. I’ll redo this, using max contributions over the years, compounding annually, but I think it is not going to look much different.
What would be the case for an immigrant that arrived to the country in 2007? So has only contributed for 17 years. Will this calculator help to catch that?
Absolutely it should. You are entitled to the benefits as long as you contributed for number of years. You can use Service Canada calculator for reference.
I contributed to my RRSP from Jan-May 2024, and then retired in June. I recently opened a RRIF but did not transfer any funds into it yet. Am I allowed to transfer $2,000 into the RRIF in 2024 in order to get the pension deduction? I am 66 yrs old. Thanks
I am not sure how you opened a RRIF with no money in it? I thought you had to convert your RRSP to a RRIF? Once you get that sorted out, at 65 you can claim RRIF income as pension income and get the pension deduction, yes. If you Google it, you should get a CRA article confirming what you asked.
Doesn't appeat that this calculator is indexing for inflation. In my situation, I believe I maxed out my CPP at the end of 2024, or my CPP at 65 will be $1364.60/month or slightly more at the end of 2024. When I use the PWL calculator it calculates approximately $1380/month at the end of 2024. However, my 2025 number should now be $1433/month when indexed for inflation as per CRA's recently released maximum CPP for 2025. The PWL calculator doesn't automatically index my 2024 maximum value of $1380/month by the same inflation indexing as CRA has calculated (i.e., $1433/month). Instead the PWL calculator wants me to enter my future income for 2025 and 2026 (I turn 65 in 2026), without indexing and adding to my 2024 PWL calculation of $1380/month. The PWL calculator doesn't appear to adjust for inflation indexing when a person has already maxed out their 39 years of pensionable earnings. Some kind of error in the PWL calculator, probably because only 6% of Canadians ever max out their CPP and it it's not accounted for in the PWL calculator.
Interesting find --- will definitely have to check out the calculator to understand it better... Thanks for Sharing Adam... Just a note they do have a disclaimer about the survivor pension "Note: This tool does not currently capture the CPP survivor's pension. This may impact the outcome, particularly for individuals that will not receive the maximum benefit and have a meaningfully longer life expectancy than their spouse who is also a CPP contributor."
Maybe someone can comment....I believed everyone gets the general dropout of 8 years for the lowest income years. I also thought the dropout years for child rearing and/or disability were in addition to the general dropout years. When I played with the calculator that doesnt seem to be the case. Is this an issue with the calculator or a misunderstanding on my part?
My calculation seems correct when I leave inflation at 2.5% giving me what the benefit would be based on TODAY'S CPP payouts; or if I have inflation at 0.0%, it appears to give me the correct calculation when I reach that age at the inflation adjusted payout. These seem confusing/backwards and appears to be doing some sort of PV/FV calculation???
@ the link to the calculator (tried 3 times “..not found”). Honestly, I am naive, but when I finally got in through a back door it looked sketchy, and I didn’t trust it
break even should be independent of other income sources. .. .final might be different with TAX levels and (if you are fortunate to have that problem; OAS 'clawback' 0
@@ParallelWealth thanks ... I have been a promoter of financial planning since BEFORE: ``The Wealthy Barber` .... I started ày yourself first with converting my prov. portion of student loan (amt) ... when it was paid off, I changed that exact payment to RSP (and topped up some in Jan-Feb, often with loan - which was in itself a type of `forced saving` ... then came same for federal part of my student loan ... and then later ... my small mortgage (cheap house in NS)
@@ParallelWealth my parents were big promoters of financial planning. While my dad had a good income as a family Dr. ... he had no pension plan, and his wife (my mom) had 4 sons. ... First priority was a `safety net` in case something happened to HIM, 2nd was putting the 4 boys through further education (if they wanted) and FINAL was retirement savings.
I tried this calculator, and it does not work correctly. Firstly, it is a complete MYTH that everyone would have a 36% reduction at age 60, yet EVERY person, web-page, and video says this. It would take too long to explain, but a person would need a full 39 points (39 years of max income) to have a 36% reduction at age 60. Most people do not have a full 39 points, and coupled with the reduction in dropout years when changing from age 65 to 60, it nets only a 29% reduction (NOT 36%). If you do Doug Runchy's calculations, or use his calculator, or use the estimator on the Canada Government website, and compare the age 60 benefit vs age 65, it confirms that the reduction is NOT 36% for people who do not have a full 39 points (which is most people). I'm tired of the entire world saying that everyone will have a 36% reduction. People are trying to plan their retirements, and they are getting the wrong information. One other thing...when selecting a retirement age of 60, this calculator shows dropout years AFTER age 60 (which is impossible). Hence the wrong resulting numbers.
On the graph, you have to change the benefits age box to 60. You only need 35 "points" when you start CPP at 60, which helps by not needing to drop out as many years. Still, I thought a person who starts at 60 and had 35 full ympe years would get exactly 36% less than the person who starts at 65 and had 39 full ympe years ? I'd be curious to see the math behind this.
@@davecarpenter4917 Uggh, I don't know what is going on. I keep posting replies, and they keep disappearing. Bear with me. You may see multiple replies, or I may have to post this one word at a time. Yes, I selected 60 (and every other number) and it does not change the values at the top. What's more, is that when selecting 60, the graph shows drop out years after 60 (which is impossible). This leads me to believe that they calculated a value at 60 based on a 39 point system, and then subtracted 36%, which is the wrong way to do it. Doug's calculations are at this page(maybe the link I posted is messing things up, so just google Doug Runchey calculate CPP). To calculate the benefit at 60, you must redo all of the calculations based on a 35 point system, and then subtract 36%. Since the calculations are done on a 35 point system (instead of 39), the second last number in the calculation will be boosted, and after applying the final 36% reduction, the net reduction is 29%. Essentially, instead of getting 64% at age 60, you get 39/35 x 64% = 71% = 29% reduction. I think this myth of everyone having a 36% reduction started with the government trying to scare everyone so that they do not apply at 60 (making it seem worse than it is). It would be simple for the government to give you the exact correct numbers for your retirement, yet they don't and they deliberately obfuscate the numbers. The Service Canada website shows completely wrong numbers. The government has only one pension estimator page, and it is nearly impossible to use. Instead of allowing you to enter numbers, it only has drop down selections for income history and general estimates of values. If you fiddle with it enough, you can get it to show the results of someone who has less than 39 points, and the resulting numbers show a 29% reduction. Now we have every "expert" perpetuating the myth that everyone has a 36% reduction, and messing up everyone's retirement plans.
@@urbanoutdoorsman5654 Because they can collect CPP 5 years earlier and get 5 more years of money. Some people will do projections into the future and compute the overall money they will get over the years and compare scenarios. They then usually select the scenario that gives them the best overall return. Others simply don't have much choice, and need to take CPP early because they either won't have enough money to live, or perhaps their life expectancy is low. Their are several reasons, and a good portion of the population does indeed take it early, at a reduced yearly amount. Unfortunately, they are getting bad numbers when they are making their decisions.
@@urbanoutdoorsman5654 Uggh, I don't know what is going on - my replies never get posted, Bear with me if you see multiple replies, because I need to do this several times. Because they can collect CPP 5 years earlier and get 5 more years of money. Some people will do projections into the future and compute the overall money they will get over the years and compare scenarios. They then usually select the scenario that gives them the best overall return. Others simply don't have much choice, and need to take CPP early because they either won't have enough money to live, or perhaps their life expectancy is low. Their are several reasons, and a good portion of the population does indeed take it early, at a reduced yearly amount. Unfortunately, they are getting bad numbers when they are making their decisions.
I still can't figure this out. I will have 39 years quite probably And have always worked full time plus overtime. But like many Canadians earning min wage. Not expecting much more than $750/month retiring at 65.
The amount is so pathetic that I don’t think I want to know what Cpp is for me, I’m going to treat it like a bonus and just rely on my investments and teamsters pension to carry me. Even my teamsters pension is lousy, should have been a teacher.
We will take CPP at the earliest opportunity. In our case, a higher CPP payout will result in a higher reduction in our Social Security payment. Absolutely no point in waiting.
@ParallelWealth Actually, not too many Canadians will receive both CPP and Social Security. As stated, any increase in CPP will meet with an equal amount of reduction in Social Security. Thus, negating advantage, if any, gained from delaying CPP.
@@richardli5530OAS clawback starts at incomes exceeding 90997 in 2024. It’s impossible to exceed that income with just OAS and CPP. If someone has a defined benefits plan or has a huge RIF that’s a whole other matter. I don’t understand the use of the term “social security.”
Depending on where you work, in January your whole year's vacation entitlement is renewed so you can basically retire on January 1st even though your actual technical employment continues until late January/early February. And you can F off somewhere warm instead of spending another four months dragging your ass to work through the snow. And anyway, at that point, if you can afford to retire (i.e. if your non-CPP/OAS income sources are significant) one more year's worth of contributions isn't going to make THAT much of a difference.
It always annoys me with these calculators that they just don't care about immigrants. I was born a long time ago but I've only lived here for 8 years so I've only been accruing CPP for 8 years. Don't ask my birth date, ask what year I started accruing or provide an option for people who moved to Canada.
This is probably because it will not update anything if income is lower than the $3500 basic CPP exemption as you wouldn't have contributed to CPP and would not be eligible for a CPP benefit. I changed all numbers to zero except for 1 year at 4000 and updated results displayed....
There is something called the Child Rearing Dropout provision to help when children are small to remove those years from the calculation if you had lower income during that time.
Under the general drop out provision of the plan you are allowed to drop out 17% of total contribution periods where income would be less than your lifetime average between age 18-65. So at 65 you are allowed to drop out 96 months (564 months * 17%) of low earning periods. If you no longer contribute at age 60 and don't start your CPP till age 65 then you will use 60 months of general dropout during those years because those years will be zero and you'll have another 36 months available for other low income periods. So it really depends upon your work history and contributions to the plan between ages 18 and 65 years old.
For those wondering about the benefit difference between PWL and other calculators, here is their response: The main difference between the PWL Capital calculator and cppcalculator.com is the YMPE growth rate assumption. CPP benefits are calculated using the average YMPE from the past 5 years. cppcalculator.com assumes that this value remains constant, whereas PWL projects YMPE growth in the future based on the wage inflation and CPI inflation assumptions, and calculates the 5 year average accordingly.
This may seem like a small detail, but it can lead to significant differences in the benefit.
In the benefit, or in the benefit calculation?
Because I suspect the government’s just going to use their own calculator.
So theirs is the number I’m going with.
@@whatifschrodingersboxwasacofin 5 year average YMPE has moved from $57,780 in 2021 to $66,580 in 2025. Leaving this value the same going forward is definitely a flaw in doing this calculation as the rate does grow with time as shown over the last 5 years above ($8,800). If you're within 5yrs of retirement and at the top of CPP that would mean an extra $2,200 per year in your pocket. So having this as part of the calculation is going to be closer to reality. In fact whenever Doug Runchey does the calcs he explicitly states his number are all based in current years dollars (the year he does the calculations he did for mine anyway). So if you are not collecting for a few years you may get more and his numbers are inherently conservative in nature because of this. That being said the future is unknown so it really depends on one's personal preference, risk tolerance and contribution history when determining which method would be preferred.
My age 65 benefit has increased $1,044/year from May 2023 to Jan 2025 (1.85year). Note I haven't worked during this time so I'm kind of thinking, most, if not all, the increase has to do with the increases in YMPE over the same time period. Also 2023 would be one of my general drop out years so income in that year doesn't have any effect on the age 65 benefit.
This still doesn't make sense. The PWL calculator lets you set both wage and normal inflation (CPI) within the tool. If you set these both to zero within the PWL tool, shouldn't the 2 tools match? What am I missing here?
what if you do take cpp at 60 but retire at 65 and keeping working maxing out your yearly contribution?.....how much do you lose then?
Thanks for the shoutout! This is an incredible video - practical and to the point.
we need enhanced cpp calculator.
you also need let them input 2024 value, btw, enhanced has been out for 7 years it is not rocket science.
Thanks Ben. And appreciate you and your team putting together this calculator.
@@ybc8495 enhanced CPP is included in the PWL calculator.
Ben the results of this calculator don't match other online calculators such as Doug's cpp calculator or the calculator on the financial wiki. Your calcs show a higher number. Have you benchmarks your results against others? I set inflation to zero to align the models
This calculator is incredible. Exactly what I’ve been searching for all these years. Thanks for sharing, and hats off to Ben and the folks at PWL for giving such a helpful gift to Canadians.
Investments are the roots of financial security; the deeper they grow, the stronger your future will be."
The deeper your investment roots, the stronger your financial security will be in the future.
Yes true, I have been in touch with a brokerage Advisor. With an initial starting reserve of $80k, my advisor chooses the entry and exit commands for my portfolio, which has grown to approximately $550k.
I’ve been looking to switch to an advisor for a while now. Any help pointing me to who your advisor is?
My CFA NICOLE ANASTASIA PLUMLEE a renowned figure in her line of work. I recommend researching her credentials further... She has many years of experience and is a valuable resource for anyone looking to navigate the financial market..
I searched for her full name online, found her page, and sent an email to schedule a meeting. Hopefully, she responds soon. Thank you
Great video and analysis. The math doesn't lie, waiting gets you more money, but the one thing this misses is taxes. Taxes are a significant concern for those of us to have a good pension or a Defined Benefit Pension with a bridge until 65. If i waited to collect CPP until 65, i would have had 11 years of non contribution. My pension is my major source of income. Its adjusted to CPI. Having started planning at a young age i have RRSPs, TFSA and cash in addition to the pension. Getting more money later means OAS clawback. Waiting until 70 works best for people who have significant RRSPs
Outstanding! thanks for sharing this calculator, confirmed my thoughts with a star/benefits age of 66 for me. Retiring at 63, RRSP/RRIF aggressive meltdown for 3 years, then CPP/OAS for final 10 years of life. Sounds pessimistic to assume i'll die before 80 - trust me - it's solid.
Great video and fantastic to have an online calculator! Having survivor benefit calculation to the online calculator would be an excellent enhancement!
I have called Service Canada and had them send me projected CPP amount - 3 times. The numbers are dramatically different for each of the 3 estimates.
So, my confidence level in Service Canada numbers is low.
Thanks for this video. I have used Doug Runchey's online CPP calculator, which is always touted as the gold standard, and I have now used this one. Exact same data inputted, but a significant difference in expected CPP. Per month at age 65 $1058 vs $1250 on the PWL calculator! Why such a difference?
I don't believe that Doug factors in inflation.
GC has one as part of the Canadian Retirement Income Calculator on the Services website.
CPP is the acronym for the Canada Pension Plan and the Canadian Retirement Income Calculator (CRIC) has been around for several years. The Retirement Hub though, is quite new.
Thanks Adam for another great video, I used the Canadian CPP calculator back in April using my CPP earnings and contribution print out from CRA and now used PWL CPP calculator and to my surprise the amounts at age 65 were exactly the same amount, retired last year at age 56, cheers!
Sounds great!
Great video highlighting a really nice tool for Canadians. Thanks for bringing up the issue of survivor benefits. It would be great if those calculations could be included in the future.
Thanks for the video, and the calculator. Running my numbers, shows what I have long thought. That CPP isn't a great investment. If I retire at my planned age of 59 after 36 years of contributions and don't take CPP until age 65 my IRR around 2%.
what confuses me the most is getting conflicting information.
I go to My Service Account > CPP and they estimate I'd get $580 / month.
I go to PWL Research and use their estimator and they say $1,016 / month.
I'm not trying to be deceptive, I copied my past income into PWL straight from the CPP website. It's disheartening that the two estimates are so vastly different. I fully support planning for ones future, and knowledge is power, but this is a bit much to consume.
I would trust the PWL one
I have been on the PWL site and couldn't fine tune the calculator. Thanks for helping with the explanation
Any time!
Great tool. Thanks for this. I've always wondered what effect the drop out years would make to my expected benefit. In my case its $400/mo more that the Service Canada current projection. Reassuring.
amazing video and calculator . Thank you guys .
Thanks, a good one, waited too long, if anyone else experienced too, it doesn't recalculate with life expectancy.
Hello Adam, does this calculator take into account the new two stage CPP for higher income ?
Great tool, and thanks to Ben and Braden for making it available. However, I am not clear on how the numbers are arrived at. Compared to age 65, CPP should be 36% less at 60, and 42% more at 70, however 721 is not 36% less than 1203, and 1757 is not 42% more than 1203. Is seems the $1203 and the other numbers are future nominal dollars, but if so then the age 60 amount would be 664. Would love some clarity on how the numbers are calculated.
I found the same issue. Can't trust the numbers of this calculator
Another great video.
Have you ever made a video on the draconian rules of the LIFs?
If not, could you?
Ya we have a few on the channel
Great Video and Calculator. Thanks so much. I have a quick question. In my scenario, I became disabled at the end of 2005. Basically Stopped working in 2006 and have not worked since and will not until I hit 65 in January 2028. At that time my CPP disability will go to CPP at age 65. I put in the disability start when I started getting CPP disability in March 2010 but did not have any income since 2006. Was I supposed to enter 2006 for disability or is the date I began CPP disability correct? Thanks.
Very helpfull site for near retirees Adam. Thanks
Adam, this is great. I have a QQ: I'm 60 this year, and have just retired. When I enter all my data, including the fact that I'm no longer contributing, the tool states that I'll get ~$1,400/month when I'm 65. *But since I won't be 65 for another 5 years, does this mean that I'll actually get $1,400 per month in 2029, or that I'll get the equivalent of today's $1,400 in 2029 (i.e. it'll be ~$1,585/month if I assume 2.5% average inflation for each of the upcoming 5 years)?* Hope this makes sense.
None of these tools seem to explain this well (today vs future dollars) in their results...or at least not well enough for me to understand.
It's in today's dollars. The actual number will increase by CPI each year.
I think its in todays dollars, but you are completely right. It is confusing especially when they are asking for inflation factors to understand if that is inflating the outcome.
I was just on the Service Canada website, and it gives my CPP estimate based on all my earning. You need to open an account but thats pretty simple.
It does but it assumes that your recent income will continue until your regular retirement age. This may be fine and close for most people, and especially if you are near the retirement age, but it is wrong if you retire early, had many child bearing years etc.
This PWL one will be more accurate.
Thank you for this calculator. Are the numbers that show for age 70 in today’s dollars or in future dollars?
Todays dollar
I've tried for two hours to work the PWL calculator, and it kicks out after I'm about half way through entering my pensionable income figures. They don't always record properly and I've never been able to make it to the end before it kicks me out and starts all over again. :(
First I have heard of that. I would contact them
Turns out was my browser. Didn’t work on Safari, but finally worked on Chrome. All good!
Not sure how to use the self employed option. I had years of both, self employed and employer employed.
Can this calculator be used if you’re already retired but are not yet collecting CPP? I retired at 60, will be 65 next year. I have a defined pension plan with a bridge until 65 and am on the fence about applying for my CPP when I turn 65.
No reason why you can't use it as you control the assumptions and can input your own retirement date and past income earnings towards CPP. I have noticed the benefit amounts are around $20 less than my CPP statements. Not sure why that is as I'm between 60 - 65 but still trying to understand the numbers this calculator generates and when assumption flags/data is changed and the impact it has on the overall numbers.
If you have a bridge ( I do) it is designed that CPP replaces the drop of the bridge at 65. If you wait until 65 one replaces the other. Then OAS is extra money. I took mine 2 months ago at 61. CPP plus OAS puts me about $4000 ahead of my current income. But in the meantime my CPP is going into my TFSA and high interest savings account. I also retired at 54 so non contribution years also played a roll. You should also consider if you wait will you run into OAS clawback. I'm getting $40,000 head start vs at 65..4 years of compounding interest
@@garth217 Not sure why people focus on the OAS clawback, it's only 15% of income above the threshold. That means for every $10K in income you forfeit $1500 of OAS but you're still getting $8500 more net income.
@pseudocynic1 for me it's not actually the money. I paid Taxes my whole life and as a default for doing OK.. I get less than the next guy..who didn't pay as high taxes I did.
@@pseudocynic1 I get your OAS clawback comment and wonder why there isn't the same level of anxiety over the Age Tax Credit loss. My only thought is because the Age Tax Credit isn't actually money lost (IE a loss of a tax credit no longer eligible for rather than an decrease in income). With OAS it is actually less money received (therefore more tangible).
This being said I kind of get the issue with losing OAS more so than the age tax credit. Maybe because the income threshold for tax threshold is so low people are not near that line and could never get there anyway. But with OAS many with DB pensions or good savers it may be hard to rationalize hard saving all your life to set up your retirement only to lose a benefit whereby you probably paid higher taxes all your life as well which pays for that benefit. I dunno
In the end I'm not too worried about the OAS clawback because if you set up your retirement savings in a good way whereby you can even out all your family income in 2024 you would need to have adjusted taxable family income of $182,000 to even start losing OAS funds. I wouldn't have a problem meeting our lifestyle expenses with significantly lower than that sum of annual cash.
What a great idea!!! It was VERY GLITCHY! Numbers would change constantly when I tried to input my past income. I could not get it to work. Would like to use it in the future if the software is fixed.
I noticed some of that happening as well --- I kind of chalked it up to an overflow of people using the site at once... let things settle down for a few days then try it again.
I had no issues but it could be a platform problem or browser settings. Worked for me using Windows 10/Firefox and Android 14/Firefox (both updated to latest versions).
@@pseudocynic1 I tried it on Windows and iOS and both were glitchy. It may be a result of over use.
@@markbeaulieu8004 Frustrating, dunno if the page uses Java applets but maybe try updating (or installing) Java.
Thanks for this very useful calculator. Is this also factoring in the YAMPE, Years additional max pensionable earnings ? I read that the CPP was going to increase quite a bit with the YAMPE. I don't see any drastic increases after the large CPP increases in 2024 & 2025. Thanks again.
Thanks for the great info., especially the tip on accessing CRA to obtain past year's T4 information. However, when I accessed CRA, it seems that they only have T4 info. for the past 10 years. How can I obtain T4 information prior years?
Its not your T4 that you need, there is a statement of contributions. Go into your My Service Canada account-Canada Pension Plan-Payments-View my contributions. That will list your lifetime CPP contributions.
Service Canada will have lifetime (not CRA)
Great idea. I can't get it to work though. After inputting my numbers nothing changes on the results and graphs side. They are still the numbers that were used as examples. Will try again another day.
Great tool. Thank you PWL ! I retired a few years ago, but am working part time as I approach 60. I was able to graphically see the effects of either quitting and starting cpp at 60, working until 65 but start cpp at 60 (the PRB is calculated, nice !) , or working until 65 and then starting cpp.
So then I did a little task to see the effect of working pt up to cpp start for each age from 60-65 (In other words, when I stop working, I start CPP). From a baseline at 60; At 61 I get a 12.7% increase in my forever money. At 62, its another 10.5%, 63 adds 9.1%, 64 adds 8.1%, 65 adds 6.5%.
All together, it's a 46.9% increase in CPP by working pt (approx a third of ympe) and waiting until 65.
Everyone's case is different, and in mine I cannot drop any of these lower income part-time years out, so the data I generated shows the effect of accumulating low income years.
Comparatively- If I was to stop working at 60, but then wait until 65 to draw cpp, I only get $500/yr less than I would had I kept working until 65. Not a whole lot.
Where exactly do I find MY spreadsheet on the CRA site. I'm on it right now and I can seem to find it .... although I think I have seen it before. If someone could post a "tree" if you know what I mean of how to get there. Thanks
I retired at age 61, decided to start CPP when it hit 1k per month. Yes I could have waited, but I ran the break even age and it came close to my families life expectancy history. So the idea of leaving what CPP owes me (after taking from me my entire life) on the table makes no sense.
What assumptions did you make to determine your break-even age? For example, were your CPP payments going to be used as cash flow for living expenses or saved and invested at a specific rate of return, is there a spouse involved that will run up against the maximum payout if you predecease them or was there concern about legislative changes to the plan? We all have unique circumstances and I find it instructive to hear other people's situation.
My wife and I both retired at 61 over 2 years ago and will begin drawing down our RRIFs next month to supplement our small pensions and investment income. We are fortunate in that we don't need CPP and can delay benefits for as long as we like but the trade-off between waiting to get a larger payout later or dying earlier than anticipated is difficult to judge.
Remember that RIF are taxed at 30% over $15,000. That money is withheld at source. If you have a modest pension that tax money is held by the government until the tax period..if you take it out next month like you said the government had your extra tax money until APRIL 2026. Take the money now
My understanding is this calculator is today's dollars (PV) and therefore the actual amount you receive in the future is a lot more. I put 0% in the expected inflation field and got what looks to be the actual future dollars.. is that correct?
Is Quebec the only province that send you an official estimate(starts at age 54, and updated every 2 years) as to what you will be getting if you retire at age 60 & 65 ?
Of note, the calculator does not factor in the opportunity cost of delaying CPP payments … depending on individual circumstances, some individuals may get greater personal enjoyment out of a smaller amount right now instead of waiting for a larger amount later.
We have many other videos on opportunity costs - taking early and investing. Hint: it's worth delaying!
This might be obvious to many, but not so much to me: would these be real (2024) dollars, or nominal dollars? I can't seem to find any information on that. If I were to set both inflation and wage inflation to 0, does that provide real dollars?
The application uses present value calculations which is why you see the amount of money your receiving after you start CPP to never change. The amount received will go up with inflation but because of inflation the present value purchasing power will not change.
So waiting till I'm 70 increases cpp... am I right to assume the extra 5 years of contributions also create a larger cpp ??
If you contribute to the CPP beyond 65 it would increase it (Post Retirement Benefit)
If I income split my husband's work pension when I am in my forties, do I also get to claim the $2000 pension credit?
It's not your pension. It's income for you and no credit.
If the pension income your husband is getting is considered pension eligible income you can claim the $2,000 pension credit when he transfers at least $2000 of pension eligible income to you. Search the governement web site for eligible pension and annuity income (less than 65 years of Age). There it explains the income eligible for this tax credit.
My husband will be 68 December 27th. He plans to retire in July or August 2025. He has a work pension as well. How much income tax will Revenue Canada take from his monthly CPP payment. Or do we have to take it off ourselves and how much.
taxes are not deducted from your cpp ammount. When you apply, you can choose to have a percentage held back. How much you ask to be deducted is up to you and depends on your projected retirement income.
Stay within the threshold of 43 K ( income from all the sources except OAS) it won’t be more than 10%.
@@APICSKH Thank you
@@katt1941 Thank you
I had CPP withhold 25%. I'd rather get a refund than owe money
Got the PWL program running. What is the easy way for me to view my 30 years of tax fillings to round up my CPP contributions. I attempted through "My Services Canada" but did not find what I was looking for.
CPP Earnings and Contributions on the gov't site. From that data, the 'base portion' goes into the PWL calculator under Assumptions/Earnings/Past Income.
I know QPP and CPP are very similar but - Should I assume this does NOT do QPP or still pretty good ? Tks
Full QPP options near the top right. Do mention this in the video as well.
When my mum retired and applied for CPP, she had me and my siblings sign a paper, application form, with birthdates and SIN. Basically stating she was at home raising us and not working outside the home.
@@PamMcGarvie that was for the child rearing provision, totally worth it for those who took some time off to raise children.
@@calleycousins6622 Yes. It removes the years that mothers stay home. Basically it lowers the denominator in the calculation and increases the average.
Canadians should know about CPP2, what can you tell us about that?
Does it account for CPP2?
Yup.
Thank you for the vid. Sounds like a great resource but it has a few bugs. Tried to enter the yearly income and as I went through the years it would lower the past years to the default value again. Don’t know how to inform them of this. Would be good to tell the devs. They worked hard on this and probably want to know that this happens to squash the bug.
Riddle me this. Assume that you have a well paying job out of college and max out the EI CPP. Take the employee and employer contributions and apply a reasonable return rate say 5%. I might have done my math wrong, but I looking at what was in that pool and looking at 5%, comparing that to what we actually get looked atrocious. I’ll redo this, using max contributions over the years, compounding annually, but I think it is not going to look much different.
What would be the case for an immigrant that arrived to the country in 2007? So has only contributed for 17 years. Will this calculator help to catch that?
Absolutely it should. You are entitled to the benefits as long as you contributed for number of years. You can use Service Canada calculator for reference.
one can request the contribution data from service canada and mail's it to you
I contributed to my RRSP from Jan-May 2024, and then retired in June. I recently opened a RRIF but did not transfer any funds into it yet. Am I allowed to transfer $2,000 into the RRIF in 2024 in order to get the pension deduction? I am 66 yrs old. Thanks
I am not sure how you opened a RRIF with no money in it? I thought you had to convert your RRSP to a RRIF? Once you get that sorted out, at 65 you can claim RRIF income as pension income and get the pension deduction, yes. If you Google it, you should get a CRA article confirming what you asked.
Link posted is not working.
Doesn't appeat that this calculator is indexing for inflation. In my situation, I believe I maxed out my CPP at the end of 2024, or my CPP at 65 will be $1364.60/month or slightly more at the end of 2024. When I use the PWL calculator it calculates approximately $1380/month at the end of 2024. However, my 2025 number should now be $1433/month when indexed for inflation as per CRA's recently released maximum CPP for 2025. The PWL calculator doesn't automatically index my 2024 maximum value of $1380/month by the same inflation indexing as CRA has calculated (i.e., $1433/month). Instead the PWL calculator wants me to enter my future income for 2025 and 2026 (I turn 65 in 2026), without indexing and adding to my 2024 PWL calculation of $1380/month. The PWL calculator doesn't appear to adjust for inflation indexing when a person has already maxed out their 39 years of pensionable earnings. Some kind of error in the PWL calculator, probably because only 6% of Canadians ever max out their CPP and it it's not accounted for in the PWL calculator.
Interesting find --- will definitely have to check out the calculator to understand it better... Thanks for Sharing Adam...
Just a note they do have a disclaimer about the survivor pension "Note: This tool does not currently capture the CPP survivor's pension. This may impact the outcome, particularly for individuals that will not receive the maximum benefit and have a meaningfully longer life expectancy than their spouse who is also a CPP contributor."
Great video- Just curious if you log into the CRA website won't it show what you can expect for CPP?
Strange, if you change future income to zero the expected benefit does not change.
Maybe someone can comment....I believed everyone gets the general dropout of 8 years for the lowest income years. I also thought the dropout years for child rearing and/or disability were in addition to the general dropout years. When I played with the calculator that doesnt seem to be the case. Is this an issue with the calculator or a misunderstanding on my part?
My calculation seems correct when I leave inflation at 2.5% giving me what the benefit would be based on TODAY'S CPP payouts; or if I have inflation at 0.0%, it appears to give me the correct calculation when I reach that age at the inflation adjusted payout. These seem confusing/backwards and appears to be doing some sort of PV/FV calculation???
Page not found
Which page?
@ the link to the calculator (tried 3 times “..not found”). Honestly, I am naive, but when I finally got in through a back door it looked sketchy, and I didn’t trust it
Just tried again my 404 friend
break even should be independent of other income sources. .. .final might be different with TAX levels and (if you are fortunate to have that problem; OAS 'clawback' 0
This is one of the best comments I have seen on a video - you get it! Well done. Now to teach others :)
@@ParallelWealth thanks ... I have been a promoter of financial planning since BEFORE: ``The Wealthy Barber` .... I started ày yourself first with converting my prov. portion of student loan (amt) ... when it was paid off, I changed that exact payment to RSP (and topped up some in Jan-Feb, often with loan - which was in itself a type of `forced saving` ... then came same for federal part of my student loan ... and then later ... my small mortgage (cheap house in NS)
@@ParallelWealth my parents were big promoters of financial planning. While my dad had a good income as a family Dr. ... he had no pension plan, and his wife (my mom) had 4 sons. ... First priority was a `safety net` in case something happened to HIM, 2nd was putting the 4 boys through further education (if they wanted) and FINAL was retirement savings.
Nobody can answer this question.......what if you take cpp at 60 but retire at 65....maxing out your contributions still between 60 and 65?
Tried this calculator and it doesn’t work. You can’t change the numbers listed in the different earning years. Unfortunately not useful
All past and future income figures can be edited. Try refreshing the page. If you are on mobile, double click.
Yeah, I also had a problem entering those values. Try clicking Enter after entering each value instead of selecting the next cell.
@@BenFelixCSI tried again and still can’t get it to work on my mobile iPhone.
@@GarryMurray-i1y I had that problem, it works fine on a laptop or PC.
I tried this calculator, and it does not work correctly. Firstly, it is a complete MYTH that everyone would have a 36% reduction at age 60, yet EVERY person, web-page, and video says this. It would take too long to explain, but a person would need a full 39 points (39 years of max income) to have a 36% reduction at age 60. Most people do not have a full 39 points, and coupled with the reduction in dropout years when changing from age 65 to 60, it nets only a 29% reduction (NOT 36%). If you do Doug Runchy's calculations, or use his calculator, or use the estimator on the Canada Government website, and compare the age 60 benefit vs age 65, it confirms that the reduction is NOT 36% for people who do not have a full 39 points (which is most people). I'm tired of the entire world saying that everyone will have a 36% reduction. People are trying to plan their retirements, and they are getting the wrong information.
One other thing...when selecting a retirement age of 60, this calculator shows dropout years AFTER age 60 (which is impossible). Hence the wrong resulting numbers.
On the graph, you have to change the benefits age box to 60.
You only need 35 "points" when you start CPP at 60, which helps by not needing to drop out as many years. Still, I thought a person who starts at 60 and had 35 full ympe years would get exactly 36% less than the person who starts at 65 and had 39 full ympe years ? I'd be curious to see the math behind this.
@@davecarpenter4917 Uggh, I don't know what is going on. I keep posting replies, and they keep disappearing. Bear with me. You may see multiple replies, or I may have to post this one word at a time.
Yes, I selected 60 (and every other number) and it does not change the values at the top. What's more, is that when selecting 60, the graph shows drop out years after 60 (which is impossible). This leads me to believe that they calculated a value at 60 based on a 39 point system, and then subtracted 36%, which is the wrong way to do it. Doug's calculations are at this page(maybe the link I posted is messing things up, so just google Doug Runchey calculate CPP). To calculate the benefit at 60, you must redo all of the calculations based on a 35 point system, and then subtract 36%. Since the calculations are done on a 35 point system (instead of 39), the second last number in the calculation will be boosted, and after applying the final 36% reduction, the net reduction is 29%. Essentially, instead of getting 64% at age 60, you get 39/35 x 64% = 71% = 29% reduction.
I think this myth of everyone having a 36% reduction started with the government trying to scare everyone so that they do not apply at 60 (making it seem worse than it is). It would be simple for the government to give you the exact correct numbers for your retirement, yet they don't and they deliberately obfuscate the numbers. The Service Canada website shows completely wrong numbers. The government has only one pension estimator page, and it is nearly impossible to use. Instead of allowing you to enter numbers, it only has drop down selections for income history and general estimates of values. If you fiddle with it enough, you can get it to show the results of someone who has less than 39 points, and the resulting numbers show a 29% reduction. Now we have every "expert" perpetuating the myth that everyone has a 36% reduction, and messing up everyone's retirement plans.
@@reginaldmitchell-w1owhy would anyone want to take a 29% reduction?
@@urbanoutdoorsman5654 Because they can collect CPP 5 years earlier and get 5 more years of money. Some people will do projections into the future and compute the overall money they will get over the years and compare scenarios. They then usually select the scenario that gives them the best overall return. Others simply don't have much choice, and need to take CPP early because they either won't have enough money to live, or perhaps their life expectancy is low. Their are several reasons, and a good portion of the population does indeed take it early, at a reduced yearly amount. Unfortunately, they are getting bad numbers when they are making their decisions.
@@urbanoutdoorsman5654 Uggh, I don't know what is going on - my replies never get posted, Bear with me if you see multiple replies, because I need to do this several times.
Because they can collect CPP 5 years earlier and get 5 more years of money. Some people will do projections into the future and compute the overall money they will get over the years and compare scenarios. They then usually select the scenario that gives them the best overall return. Others simply don't have much choice, and need to take CPP early because they either won't have enough money to live, or perhaps their life expectancy is low. Their are several reasons, and a good portion of the population does indeed take it early, at a reduced yearly amount. Unfortunately, they are getting bad numbers when they are making their decisions.
I still can't figure this out.
I will have 39 years quite probably
And have always worked full time plus overtime.
But like many Canadians earning min wage.
Not expecting much more than $750/month retiring at 65.
The amount is so pathetic that I don’t think I want to know what Cpp is for me, I’m going to treat it like a bonus and just rely on my investments and teamsters pension to carry me. Even my teamsters pension is lousy, should have been a teacher.
We will take CPP at the earliest opportunity. In our case, a higher CPP payout will result in a higher reduction in our Social Security payment. Absolutely no point in waiting.
Run this with your planner. Based on thousands of plans we have done it usually ends up being the opposite.
@ParallelWealth Actually, not too many Canadians will receive both CPP and Social Security. As stated, any increase in CPP will meet with an equal amount of reduction in Social Security. Thus, negating advantage, if any, gained from delaying CPP.
@@richardli5530OAS clawback starts at incomes exceeding 90997 in 2024. It’s impossible to exceed that income with just OAS and CPP. If someone has a defined benefits plan or has a huge RIF that’s a whole other matter. I don’t understand the use of the term “social security.”
This video begs the question...why didn't Parallel Wealth build a calculator?
Our staff are busy building retirement plans!
Why would anyone retire in Jan. Depending on you salary you will max out you CPP contributions by May or June. Retire for the summer. Not for Jan.
Depending on where you work, in January your whole year's vacation entitlement is renewed so you can basically retire on January 1st even though your actual technical employment continues until late January/early February. And you can F off somewhere warm instead of spending another four months dragging your ass to work through the snow. And anyway, at that point, if you can afford to retire (i.e. if your non-CPP/OAS income sources are significant) one more year's worth of contributions isn't going to make THAT much of a difference.
No children ...worked all my life and taken care of my elder wife...wth
It always annoys me with these calculators that they just don't care about immigrants. I was born a long time ago but I've only lived here for 8 years so I've only been accruing CPP for 8 years. Don't ask my birth date, ask what year I started accruing or provide an option for people who moved to Canada.
You put in your earnings per year, which will be zero early on. These calcs are built for all.
It does not work...$1043/month even if Past Income = $0 every year....
This is probably because it will not update anything if income is lower than the $3500 basic CPP exemption as you wouldn't have contributed to CPP and would not be eligible for a CPP benefit. I changed all numbers to zero except for 1 year at 4000 and updated results displayed....
What if you die! Just enjoy your life and money and retire whenever you want. 😊
So being a woman with child you get penalized. Cool.
There is something called the Child Rearing Dropout provision to help when children are small to remove those years from the calculation if you had lower income during that time.
No thanks, built my own.
Well, if i retire at 60 and don't pay into any more, do i get penalties
Under the general drop out provision of the plan you are allowed to drop out 17% of total contribution periods where income would be less than your lifetime average between age 18-65. So at 65 you are allowed to drop out 96 months (564 months * 17%) of low earning periods. If you no longer contribute at age 60 and don't start your CPP till age 65 then you will use 60 months of general dropout during those years because those years will be zero and you'll have another 36 months available for other low income periods. So it really depends upon your work history and contributions to the plan between ages 18 and 65 years old.