Canada – a great place to... retire?

Canada is a great place to live. With a high standard of living, friendly residents, ample natural resources and all the scenic wonders available, the list of good reasons is lengthy. But what about Canada being a great place to retire? Before you start packing your bags for Arizona it’s  important to take stock of the many benefits available to Canadian retirees – benefits not available to those retiring in many other countries.

CPP/QPP retirement benefits. All wage earning and self-employed Canadians are eligible to receive either the Canada Pension Plan or the Québec Pension Plan (CPP/QPP) retirement benefits1. There are also CPP/QPP survivor and dependents’ benefits as well as a lump sum death benefit. A couple can choose to share CPP/QPP benefits for tax purposes.

RRSPs/RRIFs. Canadians can take advantage of the tax-deferred, compound growth benefits of Registered Retirement Savings Plans (RRSPs) and Registered Retirement Income Funds (RRIFs). Any Canadian resident who receives periodic payments from a registered pension plan can potentially reduce their taxes by splitting pension income with a spouse/common-law partner. Those over age 65 who receive RRIF income are also eligible for the federal and provincial Pension Income Credit and can allocate up to 50% of their RRIF income to a spouse for tax purposes.

OAS. Those who have lived in Canada for at least 40 years after age 18 will receive the full monthly Old Age Security (OAS) benefit1. Canadian residents who have lived in Canada for at least 10 years after age 18 will receive a prorated OAS monthly payment.

GIS. Seniors with a lower income may be eligible for the Guaranteed Income Supplement (GIS), a tax-free monthly payment¹.

TFSAs. Canadians can invest $5,000 yearly in Tax-free Savings Accounts (TFSAs). TFSAs generate tax-free investment income that does not affect income-tested federal benefits.

Tax credits. Every tax-eligible Canadian gets the Basic Personal Tax Credit and those over age 65 also receive an Age Credit. Other tax credits that can benefit retirees include the Medical Expense Credit, the Dependent Credit, the Disability Credit, and the Caregivers Credit. There are also generous tax credits for those making charitable donations.

Health care services. And, of course, Canadian retirees have access to a wide range of health care services at little or no direct cost.

Yes, Canada is a great place to retire! But to make your retirement all it can be, you need a plan that includes retirement income from other sources such as your company or personal pension plan and your own investments. We can help you plan for the perfect retirement – in Canada!

¹ Indexed for inflation.

© iStockphoto.com/Grady Reese/Steve Cole

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