How Much 45-Year-Old Canadians Need Today to Retire at 65

Many planners use a 70% pre-retirement income replacement rule; with Statistics Canada reporting a $64,900 median employment income for ages 45–54 in 2023, that equates to about $45,430 per year. The article notes CPP and OAS can cover a meaningful portion and that compounding over the next 20 years is a major factor.

If you are 45 and planning for retirement at 65, the article explains there is no single magic number for savings and highlights the main factors that shape outcomes. It presents common planning conventions, recent Statistics Canada income data, and the role of government benefits and investing over the next 20 years. The piece emphasizes lifestyle, health, and location as primary drivers of how much income will be needed in retirement. It also discusses income-generating investments and references a long-standing dividend example from the Canadian energy sector. Key facts: - Financial planners commonly use a target of roughly 70% of pre-retirement income as a starting point for retirement needs. - Statistics Canada reported a median employment income of $64,900 for Canadians aged 45–54 in 2023; 70% of that figure is about $45,430 per year. - The article reports that Canada Pension Plan (CPP) and Old Age Security (OAS) will likely cover a meaningful portion of retirement income depending on contribution history and the age benefits begin. - The Government of Canada's Canadian Retirement Income Calculator is noted as a tool that can model different contribution levels, retirement ages, and savings scenarios. - The article mentions Canadian Natural Resources as an example of a dividend-paying company with a long track record of dividend increases and a reported yield around 5.1%. Summary: Retirement needs for a 45-year-old Canadian depend heavily on lifestyle choices, health circumstances, and where they plan to live, all of which can raise or lower the income required at 65. The article highlights that compounding over the next 20 years is a dominant factor for reaching a target and notes that government benefits and income-generating investments can play substantial roles in the overall picture. Undetermined at this time.