Setting your goal

Before making a plan to get there, you need to figure out where “there” is.
Here are three questions you need to ask yourself:

Age 65 is a “standard” retirement age, and it’s the age where you are entitled to the full benefits of your government programs (CPP/QPP and OAS). But it’s not the mandatory retirement age.

You may choose to retire earlier

You may choose to retire later

You may choose semi-retirement, and do some part-time work or consulting

All these options have different implications when it comes to how much you need to save, what government benefits you’re entitled to, and what payout plans you should choose.

Do you expect a relatively quiet retirement?

Do you want to travel? Or vacation at a cottage by the lake?

Do you want to pursue a passion, one you’ll need to spend money on?

What kind of lifestyle do you expect to have when you retire?

Answering these questions will help you determine your budget at retirement, and what kind of annual income you will need.

Experts suggest you should plan to replace about 70% of your salary.

This assumes that some of your expenses might be reduced at retirement. Like if your mortgage is paid off and your children are grown and living on their own. Plus you’ll be entitled to certain discounts at age 65.

But you might also have some additional expenses, like extra medical or dental insurance that you may have now through your workplace plan, but won’t have access to when you retire.

Figure out your expenses at retirement:

Open My monthly expenses

Your retirement income will likely come from a combination of three sources:

  • Government programs (CPP/QPP, OAS)
  • Your group savings and retirement program
  • Your personal savings (real estate, other savings plans or other income)

The government will only give you a portion of what you’ll need. The rest will have to come from you.

Here is a basic example:

If this is the retirement income you want$28,000$42,000$56,000
This is approximately what you can expect from the Government (CPP/QPP and OAS)$16,000$19,000$19,000
This is approximately what will have to come from your group & personal savings$12,000$23,000$37,000

The examples above are provided for illustration purposes only and are not guaranteed. Retirement incomes assume a level income from age 65 to 90 and a net 5% rate of return. All amounts are pre-tax and are indexed at 2% for inflation, up to retirement. For more information on government benefits and the maximum amount you are allowed to contribute, go to

For a better understanding of what to expect go to the sections on retirement planning on the
Services Canada or the Régie des rentes Québec web sites.

Now that you have an idea of how much retirement income you’ll need:

  • set your retirement income goal, and
  • decide when you want to retire

Next, let’s look at how to get there.