Planning for retirement is one of the smartest financial steps any Canadian worker can take—and the Canada Pension Plan (CPP) is at the heart of it. Whether you’re years away from retiring or already considering when to start drawing your pension, knowing how much you could receive each month and how to boost those payments is key.
In 2025, the CPP offers monthly benefits ranging from $816 to $1,364, based on your contributions and the age you begin collecting. Here’s what you need to know.
Overview
The Canada Pension Plan is a mandatory social insurance program that provides monthly income to eligible retirees. You and your employer contribute to CPP during your working years, and in retirement, you get regular payments based on those contributions.
| Key Detail | Amount/Info |
|---|---|
| Monthly Payment Range | $816 – $1,364 (2025) |
| Average CPP for New Pensioners | $1,064/month |
| Maximum CPP at Age 65 | $1,364/month |
| Minimum Contribution Payment | $816/month |
| Delayed Retirement Bonus | 0.7% increase per month after age 65 |
| Early Retirement Reduction | 0.6% decrease per month before age 65 |
How
So, how is your CPP calculated?
Your payment is based on how much you contributed while working and for how long. The more years you contribute—and the higher your income—the better your payout.
For example:
- Contribute consistently at a high income = Up to $1,364/month
- Gaps in work or low income = Payments closer to $816/month
Start
You can begin receiving your CPP as early as age 60 or as late as age 70. When you start affects how much you get:
| Start Age | Monthly Change | Example (Max $1,364) |
|---|---|---|
| 60 | -36% (0.6%/month) | $872/month |
| 65 | Full payment | $1,364/month |
| 70 | +42% (0.7%/month) | $1,936/month |
If you’re healthy and can wait, deferring until age 70 gives you the highest payout.
Eligibility
To qualify, you must:
- Be at least 60 years old
- Have contributed to CPP during at least one year of work
- Be earning over $3,500/year (minimum to contribute)
- Be a Canadian resident or have worked in Canada (some exceptions apply)
Even if you’ve lived or worked abroad, you may still qualify due to international agreements between Canada and other countries.
Contributions
CPP contributions are based on your income. In 2025:
- Year’s Basic Exemption: $3,500
- Maximum annual contribution: $3,166.45
- Self-employed? You pay both the employee and employer share
The more you earn—and the more you contribute—the higher your retirement income.
Spouse
CPP isn’t just for individuals. There are benefits for couples, too.
1. Survivor Benefits
If your spouse passes away, you may be eligible for up to 60% of their CPP benefit.
2. Pension Sharing
If you and your spouse both receive CPP, you can share benefits to even out income and reduce taxes.
3. Divorce or Separation
CPP credits can be split between former partners for the years you were together.
Maximize
Want to get more out of CPP? Try these strategies:
1. Contribute Every Year
Even part-time work adds up. Avoid contribution gaps if possible.
2. Delay Your Pension
If you can wait until age 70, you could receive nearly $600/month more than starting at 60.
3. Check Your Contribution Record
You can view your history in My Service Canada Account to ensure accuracy.
4. Consider Voluntary Contributions
If you’re self-employed or had gaps, voluntary contributions may help boost your future payout.
Apply
Applying for CPP is simple, but timing matters. Here’s how to do it:
Online:
- Log in to My Service Canada Account
- Fill out the CPP retirement pension application
- Submit electronically
By Mail or Phone:
- Call Service Canada to request a paper application
- Fill it out and mail with necessary documents
Apply 6 Months Early:
This gives enough time to process your claim and avoid delays.
Documents Needed:
- SIN (Social Insurance Number)
- Banking info for direct deposit
- Employment history (if required)
Bonus
If you delay your pension beyond age 65, your payments increase by 0.7% per month, or 8.4% per year. Waiting until 70 boosts your monthly CPP by up to 42%.
Example
Let’s say you’re 65 in 2025 and eligible for the max $1,364. You could:
- Take it now and receive $1,364/month
- Wait until 70 and receive approx. $1,936/month
- Start at 60 and receive only $872/month
It depends on your health, other income sources, and retirement goals.
The Canada Pension Plan is a crucial part of your retirement strategy. Whether you’re starting at 60, waiting until 70, or somewhere in between, understanding how it works and how much you’re entitled to is essential.
Don’t forget to factor in other income sources like OAS, workplace pensions, or RRSPs to create a complete financial picture. The earlier you plan, the more flexibility you’ll have when retirement arrives.
FAQs
When can I start CPP?
You can start at age 60, but payments are reduced.
What is the max CPP in 2025?
The maximum is $1,364 per month at age 65.
How do I apply for CPP?
Apply online via My Service Canada Account or by mail.
Is CPP taxable income?
Yes, CPP payments are considered taxable income.
Can I receive CPP and OAS together?
Yes, you can receive both CPP and Old Age Security.
