It is never too early to start planning for retirement.

Whatever your dreams for your retirement, having a strategy in advance will give you the tools you need to make them a reality. By having a good understanding of basic financial concepts related to retirement, you can get the most out of the tools available to you.

But where do you start?

Knowing your sources of income

Where is the money you need in retirement going to come from? Analyzing your various sources of income is the first step to being well prepared for the retirement of your dreams.

Public plans

Two pillars of government plans may pay you benefits each month:

First pillar:

Old Age Security (OAS)

Second pillar:

  • Quebec Pension Plan (in Quebec only)
  • Canada Pension Plan (all other provinces)

Private plans

To have a comfortable lifestyle when you retire, you will have to add more savings to the benefits paid under these public plans, which only provide a minimum basic income. Many employers offer retirement plans, like defined-contribution and defined-benefit plans and registered retirement savings plans (RRSP).

Personal savings

The money you will have saved throughout your life will add to your retirement income. There are different ways to save for retirement. The most common are RRSPs and voluntary retirement savings plans (VRSP) (in Quebec only).

Determining the age at which you want to retire

You will have to think about the approximate age at which you want to retire. The amount you will have to save to achieve your objectives and maintain your lifestyle will vary based on the time before retirement you will have to save. If you decide to receive benefits before age 65, you will only receive a percentage for the rest of your life.

Before age 60

If you have a retirement plan with your employer, you could be entitled to early retirement. The benefit you will receive will be adjusted downward, taking into account the fact that you will receive your pension over a longer period of time.

Between 60 and 64

The Quebec Pension Plan (QPP) is available in Quebec only. The Canada Pension Plan (CPP) is available in the rest of Canada. Again, the benefit you will receive will be adjusted downward.

From 65 onwards

If you have a retirement plan with your employer, you will be entitled to the entire pension. All government assistance programs are available, without penalty. You want to continue to work? You can choose to defer your government benefits until age 70.

Calculating how much you need to save

Government plans represent a base income only. You will have to add other savings. Experts believe that your retirement income needs to be close to 70% of the salary that you earned before retirement to maintain your standard of living.


Whether you dream of travelling the globe, buying a vacation home or taking care of your grandchildren, take the time to take stock of the projects you hold dear. You must also consider how much you need to budget to cover your fixed expenses and daily activities.

Starting early is the key to success

You have everything to gain by starting to save as early as possible. Thanks to compound interest, saving consistently as soon as you enter the workforce will help you earn returns over many years. Various factors will play in your favour. Your savings will snowball!

Your age and what it means for your savings

If you plan to retire early, take the time to consider the impact it will have on your savings. Different factors, e.g., the time during which you save and cost-of-living increases, will have an impact on the amount you need to save.

Need personalized advice?

A financial advisor can explain each in detail and help you to choose the right investments to reach your savings goals.

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