How Much Money Do You Need to Retire?

There is no single amount of money that every Canadian needs to retire. Your target depends on how much you expect to spend each year.

It also depends on the income you will receive from CPP, OAS and workplace pensions. The best place to start is by estimating your retirement expenses and comparing them with your expected income.

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How Do You Calculate How Much You Need to Retire?

Start by estimating how much you expect to spend each year in retirement.

Consider expenses such as:

• Housing

• Groceries

• Transportation

• Utilities

• Insurance

• Healthcare

• Travel

• Entertainment

Your spending may look different once you retire. You may spend less on commuting and other work related expenses. You may spend more on travel or hobbies.

Next, estimate the retirement income you expect to receive. This could come from CPP, OAS, a workplace pension and other sources.

The difference between your expected spending and your expected retirement income is the amount your personal savings may need to cover.

How Much Income Will You Need Each Year?

One common retirement planning estimate is around 70% to 80% of your pre-retirement spending. This is only a starting point. Your actual needs could be higher or lower.

For example, someone currently spending $60,000 per year might estimate needing around $42,000 to $48,000 per year in retirement.

Your own budget is more useful than relying on a percentage alone.

How Much Do CPP and OAS Cover?

Government benefits can reduce how much you need to provide from your own savings.

As of 2026, the average CPP retirement pension for a new beneficiary at age 65 is $877.01 per month. The maximum is $1,507.65 per month. Your payment depends on your contributions and when you start receiving CPP.

For July to September 2026, the maximum OAS pension is $751.97 per month for ages 65 to 74. It is $827.17 for people aged 75 and older. Your actual payment may differ.

You may also have income from an employer pension or other retirement accounts.

Do You Need $1 Million to Retire?

Not necessarily.

Someone with a paid off home and a strong workplace pension may need much less in personal savings. Someone with high housing costs and no employer pension may need considerably more.

The amount in your retirement account matters. The income that amount needs to produce matters even more.

What If You Want to Retire Early?

Retiring early usually means your savings need to last longer.

You may also have several years before government benefits begin. CPP can start as early as age 60 at a reduced amount. OAS generally begins at age 65.

That means someone retiring at 55 may need enough personal savings to cover a larger portion of their expenses during the first years of retirement.

How Can You Find Your Retirement Number?

A simple starting process is:

1. Estimate your annual retirement expenses.

2. Estimate your CPP and OAS income.

3. Add any workplace pension income.

4. Add income from other reliable sources.

5. Calculate the remaining annual amount your savings will need to provide.

There is no universal retirement number. Your retirement target should be based on the lifestyle you want and the income you already expect to receive.