# How Much Do I Need to Retire in Canada? (2026) > How much you need to retire in Canada: your spending target, what CPP and OAS pay in 2026, the gap your savings must fill and how much to save monthly. Source: https://trykosh.com/learn/how-much-to-save-for-retirement-canada Guide - Wealth and retirement # How much do you need to retire in Canada? There's no single magic number. Your retirement number depends on what you'll spend, what CPP, OAS and any workplace pension will pay, and how long the money must last. Here's a four-step way to work out yours with 2026 figures. Updated October 31, 20264 min readBy the Kosh team On this page[Step 1: Estimate what you'll spend in retirement](#spending)[Step 2: Add up government pensions](#government)[Step 3: Work out the gap your savings must fill](#gap)[Step 4: How much to save each month](#monthly)[RRSP or TFSA for retirement?](#accounts)[Things that change your number](#factors)[FAQs](#faq) ## Step 1: Estimate what you'll spend in retirement Start from today's spending, not today's income. Then adjust: no more saving for retirement, maybe no mortgage, lower work costs, but more travel early on and more health costs later (provincial health plans don't cover everything, such as many prescription drugs, dental and vision for most adults). A common rule of thumb is 60% to 80% of pre-retirement income, but your own statements will give a better answer than any rule. ## Step 2: Add up government pensions Government retirement benefits, latest published amounts Benefit Maximum Notes CPP retirement pension at 65 $1,507.65 a month (January 2026) Average new and existing pension: $858.34 a month (July 2026). Depends on your contributions. OAS, ages 65 to 74 $762.50 a month (October to December 2026) Full amount needs 40 years in Canada after 18; reduced by the recovery tax at higher incomes OAS, 75 and over $838.75 a month (October to December 2026) Includes the 10% increase at 75 Most people get less than the CPP maximum, so look up your own estimate in your My Service Canada Account. If you have a workplace pension, add its projected amount from your pension statement. See [CPP and CPP2 explained](/learn/cpp-and-cpp2-explained) and [OAS and the clawback](/learn/oas-and-the-clawback). ## Step 3: Work out the gap your savings must fill Annual spending target minus government and workplace pensions equals the yearly amount your RRSP, TFSA and other savings must provide, before tax on RRSP/RRIF withdrawals. A widely used planning shortcut, the "4% rule" from US research, suggests a portfolio about **25 times** that yearly gap. It's a rough starting point, not a guarantee; retiring earlier, or wanting more certainty, points to a bigger multiple. For example: if you'll spend $60,000 a year and expect $25,000 from CPP and OAS combined, the gap is $35,000. Twenty-five times that is $875,000 in today's dollars. Pull your own CPP estimate rather than assuming a number. ## Step 4: How much to save each month How much a monthly contribution grows depends on time and returns. As an illustration only, at an assumed 5% a year after fees (not a forecast): Save each month For 15 years For 25 years For 35 years $500 $134,000 $298,000 $568,000 $1,000 $267,000 $596,000 $1,136,000 $1,500 $401,000 $893,000 $1,704,000 The single biggest lever is starting early: the 35-year column is far more than double the 15-year column for the same monthly amount. ## RRSP or TFSA for retirement? The RRSP gives a deduction now (worth your marginal rate, for example about 30% on an $85,000 Ontario salary) and taxes withdrawals later. The TFSA gives no deduction but tax-free withdrawals, which also don't count as income for OAS or income-tested benefits. Many people use both. RRSPs must be converted to a RRIF or annuity by the end of the year you turn 71. Details in [RRSP vs TFSA](/learn/rrsp-vs-tfsa). ## Things that change your number - **When you retire:** each extra working year adds savings and shortens the years you draw on them. - **When you start CPP and OAS:** starting CPP at 70 instead of 65 raises it by 42%; OAS by 36%. Starting CPP at 60 cuts it by 36%. - **A paid-off home:** lowers spending and can be a reserve, though selling it means finding somewhere else to live. - **Inflation:** CPP and OAS are indexed; your spending target should be too. - **Couples:** pension income splitting and two sets of CPP and OAS change the picture. See [money for couples](/for/couples). [Free tool**CPP calculator**Enter your CPP estimate at 65 and see what you'd get starting anywhere from 60 to 70, and the age at which waiting pays off.](/tools/cpp-calculator)[Free tool**Compound interest calculator**See how savings grow when interest earns interest, with a starting amount, monthly contributions and the compounding your account uses.](/tools/compound-interest-calculator) **Where Kosh fits** Kosh builds your retirement target from what you actually spend, adds your CPP and OAS estimates, and turns the gap into a monthly saving amount split between your RRSP and TFSA. It updates as your statements change, and it never moves money. ## Frequently asked questions How much money do I need to retire in Canada? Estimate your yearly retirement spending, subtract CPP, OAS and any workplace pension, and multiply the gap by roughly 25 as a starting point. The result depends heavily on your spending and when you retire. How much is CPP and OAS in 2026? The maximum CPP retirement pension at 65 is $1,507.65 a month as of January 2026, though the average is $858.34. OAS pays up to $762.50 a month for ages 65 to 74 and $838.75 at 75 and over for October to December 2026. Is $1 million enough to retire in Canada? It depends on your spending and other income. Using the 4% rule of thumb, $1 million supports about $40,000 a year before tax, on top of CPP, OAS and any pension. Whether that's enough depends on your lifestyle. What is the 4% rule? A planning shortcut from US research suggesting you can withdraw about 4% of a diversified portfolio in the first year of retirement and adjust for inflation afterwards with a good chance of lasting 30 years. It's a starting point, not a guarantee. When do I have to convert my RRSP? By December 31 of the year you turn 71, an RRSP must be converted to a RRIF, used to buy an annuity, or withdrawn as taxable income. ## Sources - [Canada.ca: CPP retirement pension amount](https://www.canada.ca/en/services/benefits/publicpensions/cpp/cpp-benefit/amount.html) - [Canada.ca: CPP, when to start](https://www.canada.ca/en/services/benefits/publicpensions/cpp/cpp-benefit/when-start.html) - [Canada.ca: OAS payment amounts](https://www.canada.ca/en/services/benefits/publicpensions/old-age-security/payments.html) - [Canada.ca: OAS, when to start](https://www.canada.ca/en/services/benefits/publicpensions/old-age-security/when-start.html) Written by the Kosh team and checked against the rules in force on October 31, 2026. This guide is general information, not tax, legal or investment advice. Kosh is an educational financial planning tool by Primedepth Labs. It is not registered with any Canadian securities regulator as an adviser or dealer, does not recommend specific securities, and does not hold your money or execute trades. Tax figures are estimates; confirm with the CRA or a qualified professional before acting. Investing carries risk. ## Upload your statement and Kosh does this for you. Kosh reads your bank, card and investment statements, estimates your federal and provincial tax and turns guides like this one into your own numbers and next steps. [Start free](/signup?via=learn-how-much-to-save-for-retirement-canada)