Have you done any planning for your future?


Realistically, how much do you need to retire and how much are you going to receive from the government when you do reach the age of 65? We Canadians are living longer and I can think of a few people I know that have not even thought about putting money away for retirement or are not saving enough. If I would have stashed $50 a month under my mattress for 30 years, I would have ended up with $18,000 but if I invested it and earned just 5 percent, I would have almost $40,000 – at 8 percent, that figure becomes $68,000. It’s never too early to start saving for retirement. Whether its $25 a month when you’re 15 and you just got your first part-time job, or $100 a month when you’re working a full-time job, establishing a pattern and a habit of saving a portion of your income from every paycheque can be very effective over the long term. Set up an automatic payment so the money comes out once or twice a month and you will not even notice it is gone. START TODAY!! Just do it and quit putting if off! You should put it into something you cannot touch, because after it starts to grow you will be tempted to spend it on something you really don’t need; it is just too tempting.


Now let’s say you did not think ahead and you have no or very little money for your retirement; what can you expect from the government to survive on? Well, we have two options: the Canada Pension Plan (CPP) is a contributory, earnings-related social insurance program. It forms one of the two major components of Canada’s public retirement income system, the other component being Old Age Security (OAS).


With Old Age Security, the amount of your Old Age Security (OAS) pension will be determined by how long you have lived in Canada after the age of 18. For the period from April 1 to June 30, 2013, the maximum OAS pension amount was $546.07. OAS benefits are adjusted quarterly (in January, April, July and October) if there are increases in the cost of living as measured by the Consumer Price Index.

You may qualify for a full Old Age Security pension in one of two ways:

You resided in Canada for at least 40 years after turning age 18, or you were born on or before July 1, 1952. On July 1, 1977, you resided in Canada, or on July 1, 1977, you did not reside in Canada but after turning 18, you resided in Canada for a period of time prior to July 1, 1977, or on July 1, 1977, you possessed a valid Canadian immigration visa. (Sounds like government talk to me). In addition, you must have resided in Canada continuously for the 10 years immediately before the approval of your OAS pension. If you were absent from Canada during that 10-year period, you may still qualify for a full pension if: you resided in Canada for at least one year immediately before the approval of your OAS pension, and you had periods of prior residence in Canada that were equal to at least three times the period of absence during the 10-year period (i.e., three years of residence for every year of absence).

The Canada Pension Plan provides you and your family with partial replacement of earnings in the case of retirement, disability or death. The CPP operates throughout Canada and almost all individuals who work in Canada contribute to the Canada Pension Plan. The CPP provides pensions and benefits when contributors retire, become disabled, or die. You can apply for and receive a full CPP retirement pension at age 65 or receive it as early as age 60 with a reduction, or as late as age 70 with an increase. If you continue to work while receiving your CPP retirement pension, and are under age 70, you can continue to participate in the CPP. Your CPP contributions will go toward post-retirement benefits, which will increase your retirement income. If you become severely disabled to the extent that you cannot work at any job on a regular basis, you and your children may receive a monthly benefit. When you die, CPP survivor benefits may be paid to your estate, surviving spouse or common-law partner and children. Married or common-law couples in an ongoing relationship may voluntarily share their CPP retirement pensions. The CPP contributions you and your spouse or common-law partner made during the time you lived together can be equally divided after a divorce or separation.

Listen to me, this is important! This is your future! Start putting money away for your retirement; if you don’t have a lot, just give a little. Just do it!

Kathryn Hartwell

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