How Much Do I Need to Retire in Canada?

Quick answer

A common Canadian benchmark is 25 times your annual retirement spending — the "4% rule." Want $60,000/year in retirement? You'd need roughly $1,500,000 saved if you were funding it entirely yourself. But most Canadians aren't funding it entirely themselves: CPP and OAS together typically replace $15,000–$18,000 of that annual spending, which cuts the actual savings target to closer to $1,050,000.

The real number depends heavily on your target spending, your CPP contribution history, and the age you start collecting CPP and OAS — collecting at 60 instead of 65 cuts your CPP by up to 36%, while delaying to 70 increases it by up to 42%.

The 25x rule (4% withdrawal rate), explained

The rule comes from research on how large a portfolio needs to be to sustainably support annual withdrawals without running out over a multi-decade retirement: withdraw roughly 4% of your starting portfolio each year, adjusted for inflation, and a balanced portfolio historically lasts 30+ years. Reverse the math and you get the target: multiply your desired annual spending by 25.

It's a planning benchmark, not a guarantee — market sequence risk, unusually long retirements, and large one-time costs (a health event, helping a family member) can all break the assumption. Most planners treat 25x as a reasonable starting target to work toward, then stress-test it against a more conservative 3.5% or 3% withdrawal rate as retirement approaches.

How CPP and OAS reduce what you actually need to save

The average combined CPP and OAS in 2026 is roughly $750/month and $727/month respectively — about $17,724/year combined for someone getting close to the average of both. The maximum CPP at 65 is approximately $1,364.60/month; OAS pays up to $727.67/month, indexed quarterly. Together, CPP and OAS can replace a meaningful share of your retirement income before you touch personal savings at all.

Uses average CPP + max OAS as an illustrative combined figure. Your actual CPP depends entirely on your contribution history — someone with a shorter or lower-earning work history receives meaningfully less than average, and higher lifetime earners receive more, up to the maximum.

Why the age you retire changes the number

CPP can start as early as 60 or as late as 70. Taking it at 60 permanently reduces your monthly amount by 0.6% for every month before 65 — up to 36% less. Delaying past 65 increases it by 0.7% per month, up to 42% more at 70. That's a large enough swing that it directly changes how much of your spending needs to come from personal savings versus CPP.

OAS follows similar logic: standard age is 65, but you can defer up to age 70 for a permanent 0.6% per month increase — up to 36% more than starting at 65. Retiring before 65 but delaying both CPP and OAS to maximize the guaranteed monthly amount later is a common strategy for people with enough savings to bridge the gap years.

Bottom line

Start from 25 times your target annual spending as a baseline, then subtract what CPP and OAS will actually pay you based on your contribution history and the age you plan to start collecting — that gap is what your personal savings actually need to cover. For a $60,000/year retirement, that typically turns a $1,500,000 target into closer to $1,050,000 once CPP and OAS are factored in. Use the retirement calculator below to model your own numbers.