CPP Calculator

Given the importance of the Canada Pension Plan (CPP) when planning for retirement in Canada, it is essential to know how much you can expect. While CPP pays out 100% of its benefits at age 65, you can start receiving payments as early as age 60 or defer them until age 70. Starting early means reduced benefits, while deferring results in higher monthly payments.

This calculator will help you compare CPP benefits at 60 vs. 65 vs. 70 to see when you should start collecting from the Canada Pension Plan.

How does this CPP calculator work?

This calculator takes into consideration your current age, the age at which you plan to start CPP, and your expected lifespan. It compares the total lifetime CPP benefits of starting at different ages — 60, 65, or 70 — while factoring in inflation and the opportunity cost of investing earlier payments. Enter the percentage of maximum CPP you qualify for (based on your contribution history) to get a personalized estimate.

What is the Canada Pension Plan (CPP)?

The Canada Pension Plan is a mandatory social insurance program that provides a monthly pension to Canadians who have contributed during their working years. Nearly all employed and self-employed Canadians over 18 contribute to CPP through payroll deductions. CPP is designed to replace approximately 25% of your average lifetime earnings (increasing to 33.33% with the CPP enhancement).

CPP is funded by contributions from employees, employers, and self-employed individuals. It is managed by the CPP Investment Board (CPPIB), which invests the funds to ensure long-term sustainability. As of 2025, the CPP fund exceeds $600 billion in assets.

CPP benefits at age 60 vs. 65 vs. 70

The age at which you start CPP has a significant impact on your monthly payment:

Based on 2026 maximum CPP retirement pension of $1,364.60/month at age 65.

Early CPP (before age 65)

Your payment is reduced by 0.6% for each month before your 65th birthday. Starting at exactly 60 means a 60-month reduction, resulting in a 36% permanent decrease. This reduction is permanent — it does not increase when you turn 65.

Deferred CPP (after age 65)

Your payment increases by 0.7% for each month you delay past 65, up to age 70. Deferring to age 70 results in a 42% permanent increase. After 70, there is no further benefit to delaying.

Break-even analysis: when does deferring CPP pay off?

The “break-even point” is the age at which the total CPP received by deferring matches or exceeds the total you would have received by starting early.

Key insight: If you expect to live past your late 70s to early 80s, deferring CPP generally provides more lifetime income. The average life expectancy for 65-year-old Canadians is approximately 87 for women and 84 for men, which suggests that most Canadians would benefit from deferring. However, individual health, financial needs, and other income sources all play a role.

What is the maximum CPP benefit?

The maximum CPP retirement pension at age 65 in 2026 is $1,364.60 per month ($16,375/year). However, to receive the maximum you must have contributed at or above the yearly maximum pensionable earnings (YMPE) for approximately 39 years.

The average CPP payment at age 65 is significantly lower — approximately $808.14 per month as of late 2024. Most Canadians receive the average rather than the maximum because of years with lower earnings, time spent out of the workforce, or starting work after age 18.

To see your personal CPP estimate, request your Statement of Contributions from Service Canada through your My Service Canada Account. This will show your contribution history and estimated pension amount.

CPP contribution rates for 2025

CPP base contributions

For 2025, employees and employers each contribute 5.95% on pensionable earnings between the basic exemption ($3,500) and the first earning ceiling ($71,300). Self-employed individuals pay both portions (11.90%).

Maximum employee CPP contribution for 2025: $4,034.10

CPP2 (the CPP enhancement)

Starting in 2024, a second tier of CPP contributions — known as CPP2 — applies an additional 4% contribution on earnings between the first earning ceiling ($71,300) and the second earning ceiling ($81,200 for 2025). Self-employed individuals pay both portions (8%).

Maximum employee CPP2 contribution for 2025: $396.00

The CPP enhancement will gradually increase the income replacement rate from 25% to 33.33% of pensionable earnings for those who contribute under the enhanced system. Younger workers who contribute throughout their career under CPP2 will see significantly higher pension benefits at retirement.

CPP dropout provisions

CPP includes several “dropout” provisions that exclude certain low-earning periods from the pension calculation, which can increase your benefit:

• General dropout — The lowest 17% of earning years (approximately 8 years out of 47) are automatically excluded from the calculation.
• Child-rearing dropout — Years when you were the primary caregiver for a child under 7 and had lower earnings can be excluded. You must have received the Canada Child Benefit (or its predecessor).
• Disability dropout — Years when you received CPP disability benefits are excluded from the retirement pension calculation.

These provisions mean that taking time off work for child-rearing or experiencing periods of lower income does not necessarily reduce your CPP pension as much as you might expect.

When should I start taking CPP?

The optimal age to start CPP depends on your individual circumstances:

Consider starting at 60 if:

• You need the income immediately and have no other sources
• You have health concerns that may reduce your life expectancy
• You plan to invest the CPP payments and can earn good returns
• You want to delay drawing down other retirement savings

Consider taking CPP at 65 if:

• You’re retiring at 65 and want the standard benefit
• You have moderate retirement savings and need to supplement
• You’re unsure about your health outlook

Consider deferring to 70 if:

• You have other income sources to cover expenses until 70 (work, RRSP, TFSA, pension)
• You’re in good health with a family history of longevity
• You want to maximize guaranteed inflation-protected income
• You want to reduce the risk of outliving your savings

The investment opportunity cost argument

Some financial planners argue for taking CPP at 60 and investing the payments. If you can consistently earn more than ~7.5% annually on your investments, starting at 60 and investing could come out ahead. However, this ignores the risk of poor investment returns, whereas deferred CPP provides a guaranteed, inflation-indexed increase of 8.4% per year — one of the best “risk-free returns” available.

CPP and other retirement income

CPP is just one pillar of retirement income in Canada. Most retirees also rely on:

• Old Age Security (OAS) — Universal benefit for Canadians aged 65+ who have lived in Canada for at least 10 years. Maximum $727.67/month in 2025.
• RRSP/RRIF — Personal retirement savings that are tax-deferred until withdrawal. Mandatory minimum RRIF withdrawals begin at age 72.
• TFSA — Tax-free withdrawals that do not affect OAS clawback or other income-tested benefits.
• Workplace pensions — Defined benefit or defined contribution plans from employers.
• Non-registered investments — Taxable investment accounts, rental income, etc.

Coordinating CPP with other income

Coordinating when you start CPP with withdrawals from registered accounts can help minimize taxes. For example:

• Draw down RRSPs from 60 to 70 while deferring CPP to maximize the permanent increase
• Use TFSA withdrawals to supplement income without pushing into a higher tax bracket
• Time CPP and OAS to avoid or minimize the OAS clawback (which reduces OAS when net income exceeds ~$90,997)

The retirement calculator can help you model these different income streams, and the income tax calculator shows how combined retirement income affects your tax bracket.

CPP post-retirement benefit (PRB)

If you’re receiving CPP and still working between ages 60 and 70, you continue to make CPP contributions (mandatory if under 65, optional if 65–70). These contributions earn you the Post-Retirement Benefit (PRB), which is a small additional pension added to your existing CPP each January.

The maximum annual PRB is approximately 1/40th of the maximum CPP pension. While the amounts are small individually, they accumulate and are also inflation-indexed. If you plan to work past 65, the PRB can add a meaningful boost to your retirement income over time.

CPP survivor and death benefits

CPP provides important benefits beyond the retirement pension:

The survivor’s pension is paid to the spouse or common-law partner of a deceased CPP contributor. If the survivor is also receiving their own CPP, the two pensions are combined but subject to a maximum.

Supplement your CPP with personal investments

CPP alone is unlikely to cover all your expenses in retirement. Even at the maximum, CPP provides only $16,375/year — well below the estimated $30,000–$50,000 most retirees need annually. Building a personal investment portfolio alongside CPP can help ensure a comfortable retirement. Get a $25 bonus when you open an account and follow our guide to start investing.