CPP Retirement Pension: When to Start?
The Canada Pension Plan (CPP) retirement pension is administered by the federal government. The standard age to start is 65. You can start as early as 60 or as late as 70. Starting earlier means smaller monthly payments; starting later means larger monthly payments. There is no benefit to waiting after age 70, as the maximum monthly amount is reached at 70.
How Age Affects Your Pension
According to the official Government of Canada page:
- If you start before age 65: Payments decrease by 0.6% per month (7.2% per year), up to a maximum reduction of 36% if you start at age 60.
- If you start after age 65: Payments increase by 0.7% per month (8.4% per year), up to 42% at age 70.
These are fixed percentages used to adjust your monthly amount.
Deciding When to Start
The official page states that you should consider your personal circumstances, including health, financial situation, and retirement plans. It lists two scenarios without recommending one:
- Possible reasons to start earlier: If you need to work less, or need money now to pay debts or fund retirement, you may choose to start earlier. This results in a smaller monthly pension but can help meet immediate needs, especially if you have little or no other income.
- Possible reasons to start later: If you are healthy, expect to live long, and have other income sources, you may choose to start later. This results in a larger monthly pension.
Retroactive Start Date
If you apply after reaching age 65, you can request a retroactive start date as early as 11 months before the month your application was received, but no earlier than the month after your 65th birthday. If you apply in the month of your 65th birthday or earlier, there is no retroactivity.
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