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FINANCIAL TIPS FOR SENIORS - Welcome to My Place Homecare
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Financial planning for seniors in Canada involves several unique aspects, including government benefits, healthcare, and tax considerations specific to Canadian residents. This blog series will touch on saving options for retirement, understanding your future costs and estate planning and legacy, but first, how much do you need to comfortably retire in Canada?

How much to save

There are three different methods for calculating what you should aim to save for your retirement. The first option is the 70% saved of your working income. This rule states that you should have 70% of your yearly income saved for retirement available to spend annually once you retire. For instance, if you earn a salary of $80,000 per year as a working adult, you should save and invest enough during your career to have 70% of $80,000 for approximately 25 years of retirement. In this scenario, you should have $56,000 per year saved for 25 years making the grand total of $1,400,000. This rule does not mean that during your working life you save this every single year, it simply serves as a guide for how much you should save based on the model.

The second option is the 10 times rule. For this rule, it is recommended that you save 10 times the amount of your working income. For instance, we will use the same income level as the first example; $80,000. Under this rule, you will retire with $800,000 and this will need to stretch over approximately 25 years. Based on this rule, you will have approximately $32,000 to spend each year during your retirement.

The third and final option is the 4% rule and in this rule, you live off of 4% of your total savings during retirement. If your goal is to be able to spend and live off of approximately $50,000 each year during your retirement and you should plan for approximately 25 years, this will bring your savings goal to $1,250,000.

Regardless of what rule you use; you should take advantage of the Financial Goal Calculator made available to Canadians on the government of Canada website. Once you have a goal in mind, this calculator will help you work out how much money you need to save either monthly, semi-monthly, bi-weekly, or weekly to reach your goal.

Income Sources for Seniors

Starting to save for your retirement as a working adult is important but so is understanding income options during retirement. There are a few options with different eligibility requirements, two options are public pension plans, and the other option is the guaranteed income supplement (GIS).

The first retirement income source is the Canadian Pension Plan (CPP) or the Quebec Pension Plan (QPP). The CPP and QPP are equivalent pension plans, the CPP is for all Canadians, with the exception of Quebec residents, and the QPP is only for Quebec residents.


The Canadian pension plan is a retirement pension that is paid monthly and is a taxable benefit that replaces part of your income when you retire and if you qualify, you will receive the pension for the rest of your life.


To qualify for a Canada Pension Plan (CPP) retirement pension, you must:

  • Be at least 60 years old
  • Have made at least one valid contribution to the CPP

You can continue to work after you start receiving your CPP and can make contributions until you reach the age of 70. Working will not reduce your pension amount, it can in fact increase it by means of the CPP post-retirement benefit.

How much can you earn

You can start receiving your CPP at the age of 60 and wait until you are 70 before you start collecting your CPP. For 2024, the maximum monthly amount you could receive if you start your pension at age 65 is $1364.60 and the average monthly amount paid for a new retirement pension (at age 65) in January 2024 was $831.92. the following table shows how the age you start collecting your CPP affects the amount you receive.

Age Maximum Monthly Amount % of maximum amount
60 $873.34 64%
65 $1,364.60 100%
70 $1,937.73 142%

If you start receiving payments before the age of 65, payments will decrease by 0.6% each month or 7.2% per year, up to a maximum amount of 36% and if you wait until after 65 years old, payments will increase by 0.7% each month or 8.4% per year, up to a maximum of 42%.

To find out how much you may be eligible for, check out the Canadian Retirement Income Calculator.


The Quebec Pension Plan (QPP) is a compulsory public insurance plan for workers aged 18 and over whose annual employment income is greater than $3500. Its purpose it to provide persons who have worked in Quebec and their families with basic financial protection in the event of retirement, death or disability.


In order to be eligible for QPP, you need to be:

  • At least 18 years old
  • Have an annual employment income greater than $3,500

How much you can earn

Pensions are calculated by using the average maximum pensionable earnings for the last five years. The amounts paid under the additional plan are included in the maximum amounts.

Age Maximum Monthly Amount % of maximum amount
60 $873.34 64%
65 $1,364.60 100%
70 $2,166.98 158.8%

The age for which you can begin collecting QPP is no different than that for CPP, in fact the money paid out is the same as the CPP amounts when persons start to collect at 60 and 65, but the QPP offers additional incentive for waiting to collect until you at 70.

Old Age Security

The old age security (OAS) pension is a monthly payment you can get if you are 65 and older. In the majority of cases, Service Canada will be able to automatically enroll you for the OAS pension if sufficient information is available and service Canada will inform you if you have been automatically enrolled.


your employment history is not a factor in determining eligibility as you can receive the Old Age Security pension even if you have never worked or are still working. If you are living in Canada, you must:

  • Be 65 years old or older
  • Be a Canadian citizen or a legal resident at the time of your OAS pension application being approved.
  • Have resided in Canada for at least 10 years since the age of 18

In the case that you are a Canadian citizen living outside of Canada, you must meet the slightly changed criteria:

  • Be 65 years old or older
  • Have been a Canadian citizen or a legal resident of Canada the day before you left Canada
  • Resided in Canada for at least 20 years since the age of 18.

if you meet neither of these criteria, check your eligibility on

How much you can earn

Age range Annual net world income in 2022 must be Maximum monthly payment amount
65 to 74 years less than $134,626 up to $713.34
75 years and older less than $137,331 up to $784.67

Receiving OAS does not mean you cannot collect CPP or QPP, you can receive both of them at the same time and the amount will be based on your financial situation at the time of your application.

Guaranteed Income Supplement

The Guaranteed Income Supplement (GIS) is a monthly payment you can get if you are 65 or older. The supplement is based on income and is available to Old Age Security pensioners with low income. It is not taxable. In many cases, we will let you know by letter when you could start receiving the first payment.


You will qualify for this benefit if you are:

  • 65 years or older
  • You live in Canada
  • You receive old age security pension
  • Your income is below $21,624 if you are single, widowed, or divorced.
  • Your income plus the income of your spouse/common-law partner is below:
  1. $28,560 if your spouse/common-law partner received the full OAS pension
  2. $51,840 if your spouse/common-law partner does not receive an OAS pension
  3. $39,984 if your spouse/common-law partner receives the allowance

Allowance is a benefit for spouses of persons eligible to receive the GIS in the case that they are under 65, but older than 60. Additional criteria in order to receive the benefit are:

  • Is a Canadian citizen or a legal resident
  • Resides in Canada and has resided in Canada for at least 10 years since the age of 18, and
  • Your combined annual income is less than the maximum annual income threshold for the allowance.

How much you can earn

Guaranteed Income Supplement amounts – April to June 2024

Your Situation You annual income must be Maximum monthly payment amount
I am single, divorced or widowed Less than $21,624 Up to $1,065.47
I have a spouse/common-law partner who receives the full OAS pension Less than $28,560, (combined annual income of couple) Up to $641.35
I have a spouse/common-law partner who receives the allowance Less than $39,984 (combined annual income of couple) Up to $641.35
I have a spouse/common law partner who does not receive an OAS pension or allowance Less than $51,840 (combined annual income of couple) Up to $1,065.47


Allowance – April to June 2024

Your Situation Your annual net income must be Maximum monthly payment amount
I have a spouse/common law partner who receives the GIS and the Full OAS pensions Less than $39,984 (combined annual income of couple) Up to $1,354.69

To find out more about the different income sources available to seniors provided by the federal government, visit

Look out for the next financial tips for senior’s blog post coming in July 2024.

Disclaimer* Please note that this blog does not serve as financial advice and is more geared towards options for seniors. Please consult with a financial advisor or planner for your retirement savings.*