“The incentives offered by CPP/QPP – combined with the strength of these programs – have made delaying CPP/QPP benefits for as long as possible is the safest, most inexpensive approach to get secure, worry-free retirement income that lasts for life and keeps up with inflation.” – Bonnie-Jeanne MacDonald
Today, the National Institute of Ageing (NIA) released the Get the Most from the Canada (CPP) & Quebec (QPP) Pension Plans by Delaying Benefits research paper, which has outlined the significant benefits of delaying pension benefits until age 70.
The paper has shown that Canadians can significantly increase their income security in retirement by delaying their CPP/QPP benefits; however only 1% of Canadian currently delay CPP/QPP pension until 70. For example, a monthly benefit of $1,000 at at 60, if delayed grows to $2,218.75 by age 70. It is clear that with fewer resources to build up retirement savings in today’s low interest rate environment, one of the best ways to maximize retirement income is to delay CPP/QPP benefits.
As CFPs and QAFPs, when meeting with clients over the next couple of months for year-end client discussions, this research and the accompanying examples should help your clients better understand both the options for starting CPP/QPP and the significant benefits to their retirement income of delaying to age 70.
Source: FP Canada Research Foundation