Scotia Wealth Management Senior Wealth Advisor, Dave Lee, offers Total Wealth Planning in White Rock. To book an appointment, call 604.535.4743 or email

Scotia Wealth Management Senior Wealth Advisor, Dave Lee, offers Total Wealth Planning in White Rock. To book an appointment, call 604.535.4743 or email

Understanding retirement savings: What pensions Canadians receive, and when

For most Canadians, their own retirement savings are important in ensuring a comfortable retirement. But do you know what can seniors in Canada can receive in monthly benefits from the government?

Dave Lee, Senior Wealth Advisor with Scotia Wealth Management in White Rock, is here to explain.

Old Age Security (OAS)

OAS payments are based on residency, not how much you’ve personally contributed over your work career. You can start collecting OAS as early as age 65, or you may choose to defer receiving your OAS pension for up to five years – at age 70.

Why delay? One important reason is that your monthly entitlement will grow by 0.6 per cent for every month you delay receiving it. That works out to 7.2 per cent per year and results in a lifetime pension that is 36 per cent higher if you wait until age 70.

OAS increases with the cost of living every quarter. This is especially helpful during periods of higher inflation. At the time of writing, the maximum OAS payment for a 65-year-old is $648.67. Deferral to age 70 increases this to $882.19 per month.

New for July 2022, those over 75 receive an additional 10 per cent monthly. Supplements for low-income earners and survivor pensions are important for many seniors but are beyond the scope of this article.

Canada Pension Plan (CPP)

CPP operates differently in that the amount you receive is based on the contributions you and your employer make throughout your career, and so entitlements are closely linked to your employment income.

“You can start taking CPP as early as age 60, but the penalty for taking it before age 65 is really quite punitive. When you do the math, you find that for the vast majority of Canadians, it’s best to wait until at least age 65,” Dave says.

If you take CPP at age 60, your pension will be reduced by up to 36 per cent. If you wait until age 70, your pension may be larger, by up to 42 per cent.

CPP increases with the cost of living once per year. At the time of writing, the maximum CPP payment for a 65-year-old is $1253.59. This shrinks to $802.30 if starting at age 60 and grows to as much as $1,780.10 at age 70.

“People find it really hard to wait because they have been paying into the system for so long,” explains Dave. “But they make better decisions when they know exactly what the numbers are for their own situation.”

Figuring out how to get the maximum benefit from government pensions also requires considering your tax situation, marital status, other pensions, current health, family history of longevity and the size of your financial assets.

Next month in the Peace Arch News, Dave will offer advice on how to decide when to start collecting OAS and CPP.

Dave’s #1 piece of advice? “Don’t just copy your friend, neighbour, or even your spouse when choosing the right time to start your pensions. Every person’s situation is different, so your unique circumstances are considered by someone who fully understands all of the nuances involved.”

Call 604.535.4743 to book an appointment with Dave Lee in White Rock, or email to discuss investments, life insurance, retirement planning, estate planning, generating income and minimizing your taxes. Follow him on Facebook, Twitter and LinkedIn for more financial insights.

ScotiaMcLeod, a division of Scotia Capital Inc.

Financial planningSeniors