Canadian Retirement Income Planner

Please read all of the instructions below before you download the app. You will find the link at the bottom of this page.

October 2, 2024

"When can I retire?" and "When should I start my Canada Pension Plan?" were the two most common questions I heard whenever I discussed retirement with people.  This led me to spend three years of my spare time developing the Canadian Retirement Income Planner which I designed to help Canadians answer these two very important questions for themselves.  My idea was to provide a platform where users could enter a minimum amount of information and then be shown some different retirement scenarios based on their age.

The Canadian Retirement Income Planner is an educational tool that will hopefully prepare you to make some very important decisions regarding your retirement.  The two pages in the app that I consider most significant are the Income Analysis and CPP & OAS pages.  This is where you stand to learn the most about your own personal retirement income.  Having said that, the other pages contain lots of information and links to 'help' videos which will guide you to a better understanding of what is at stake for you personally.

The Canada Pension Plan (CPP) is meant to replace 25% of a worker's eligible pre-retirement employment earnings but in today's world, this may not be enough for some retirees.  Even though the CPP is being enhanced to eventually replace 33.33% of an employee's eligible pensionable income, it's going to take some time, and will even that be enough? 

To qualify for the maximum monthly CPP benefit ($1306.57 in 2023), you would have had to make maximum contributions to the CPP every year for 39 years during your working career.  This is no easy task for most people with only about 6% of Canadians meeting this standard. 

The Child Rearing Provision should be considered as an enhancement to the Canada Pension Plan (CPP) and one that may have a significant positive impact on your monthly CPP benefit.  However, it's been a rare occurrence that I have met a Canadian who has heard of it.  Why is this?  My response is that our federal government doesn't do a very good job of making it known to the general public.  While you can find it on the Service Canada website, I feel like they should be shouting it from the rooftops to everyone in the country!  Also, you have to apply for it, it won't automatically be applied to your benefit.

How does it work?  If you took time off from work or worked part-time to look after your young children, you may be able to increase the amount of your CPP retirement pension and other CPP benefits with the Child Rearing Provision.  The Child Rearing Provision allows for up to 7 years per child to be dropped from the calculations that are used to determine your CPP pension amount.  Instead, you will receive pension credits for those years where you had little or no income while raising your children.

Example:  The Child Rearing Provision made a huge difference to my wife's CPP benefit which Service Canada originally estimated would be about $665.00 per month.  We raised four children who were born in 1973, 1974, 1979 and 1982.  During this period, for the most part, she was a stay-at-home mom, only working occasional part-time jobs.  With our youngest turning 7 in 1989, she was able to have 17 years dropped from the requirement to have 39 years for a maximum CPP pension which effectively doubled her lifetime monthly benefit since she now receives almost the maximum payment every month!

It's retroactive!!!  What does this mean?  Well, if you've already been receiving CPP benefits and maybe have been for many years, you can still apply for this provision and they will give you whatever amount they calculate to make up for the months or years you missed since you started your CPP.  When I mentioned this to some friends where she had been receiving her CPP for a number of years, she applied for the benefit and received over $7,000.00 in a lump-sum payment.  And, her monthly benefit is now several hundred dollars higher!

Canadians can receive the Old Age Security (OAS) pension even if they have never worked in Canada.  To qualify, they must be 65 years old or older, be a Canadian citizen or a legal resident at the time their OAS pension is approved, and have resided in Canada for at least 10 years since the age of 18 (if you lived in Canada for at least 10 years, but less than 40 years, you will receive a partial OAS pension).  Most Canadians will receive Old Age Security (OAS) payments when they turn 65 but you can delay receiving it until age 70 to receive a higher monthly benefit.  As of this writing (4Q2024) the monthly maximum is $727.67.

On July 21, 2022 the Canadian government announced that the Old Age Security (OAS) pension was permanently increased by 10% for seniors aged 75 and over.  This means that full pensioners will get more than $800.00 extra over the first year.  This was the first permanent increase to the OAS pension since 1973, other than adjustments due to inflation.  It will strengthen the financial security of 3.3 million seniors.  Eligible seniors will not have to take any action to receive this increase—their payments will be automatically increased.

So, will a combined CPP and OAS be enough for Canadians who dream of a retirement that doesn't include a part-time job just to make ends meet?  As a rule of thumb, most sound financial advice will tell you that you'll need 70-80% of your current income when you first retire.  As you age and your needs change, you could need even more income, mostly in terms of health care, long-term care, assisted living, and other associated costs.  What sources of income will you have in the latter stages of your life?

A 2020 Toronto Star article by David Aston estimated a retired couple could live frugally on $44K a year, and an individual could manage on $33K.  Middle of the road lifestyles would be $65K for couples and $43K for singles.  This has likely gone up in the last few years but it's still a good place to start if you're doing some retirement planning.  And if you want to travel, take  some cruises, or live the good life, you might need $100K+ for couples and $75K+ for singles?  Do you know how much income you will have when you retire?

As mentioned above, the Canadian Retirement Income Planner is designed to help you make some important financial decisions about when you can retire based on the estimated income you will have after you retire.  You will have the option to enter your current working income and the app will then compare your estimated future income against this amount, helping you to determine if your monthly retirement income is going to meet your needs and expectations, an important part of any good retirement plan.  You will enter some basic personal info and then your financial info including CPP/OAS estimates, any RRSP and/or investments you own, and a workplace pension estimate (if applicable).  The app will then give you a glimpse of how much income you might expect in the three retirement scenarios.   

Even though the Canadian Retirement Income Planner was created using complex formulas, VBA code and connections to external data, it's easy to use.  Internet connectivity is required to keep the relevant federal and provincial tax and pension data up to date.  Each year in January, the North Shore Tax Data website (see screenshot below) will be updated with all of the relevant and current tax and pension data from various Canadian government sources.  Once this update has been completed, the refreshed data will automatically be downloaded to your own personal copy of the app the next time you open it.  

Screenshot of the North Shore Tax Data home page (this is where the app retrieves relevant and current tax data each time you open it).

It is essential that you have Microsoft Excel on a Windows based PC, or Excel for Mac on an Apple PC to take full advantage of the features and functionality built into the app.  Unfortunately, because of the complexity of the underlying code, the app won't function as intended if you try to use it in Excel Online, Google Sheets, Apple Numbers or other similar programs. 

If you already own a copy of Microsoft Excel, then in all likelihood you also have a Microsoft OneDrive account which you will need to download the app.  If you don't have an account, you can easily create one and it's free!  I have built a unique version of the Canadian Retirement Income Planner for each province and territory in Canada because of the differences in the tax rates and thresholds.  You will see the provincial flag of your province on the app Home Page, right next to the Canadian flag!  

You will also need:

1. a computer connected to the Internet

2. some basic personal information for you and your spouse/partner

3. your average bi-weekly payroll (optional, but highly recommended)

4. estimated workplace pension amounts (if applicable)

5. estimated CPP and OAS amounts (from Service Canada website)

6. personal savings amounts (RRSP's, LIRA's, etc.) (again, if applicable)

That's pretty much it!  After you enter your Personal Info and Financial Info, the app will automatically complete numerous calculations and then show you your projected retirement income in three age-based scenarios on the Income Analysis page.  I don't know about you but I sure wanted to know how much income I could expect to have in retirement before I left my job.

Click the button near the bottom of this page and the link will take you to Microsoft OneDrive where you will select the folder for the province or territory you reside in.  Next, right-click on the file (~1.2 mb) and select <Download> from the list.  The file should automatically download and be saved in the 'Downloads' folder on your computer, or you may be able to select which folder you want to save it in.  You must download the file to your own computer.  If you just 'left-click' the file to select it, it will open in 'Excel Online' where it will NOT work.  Please download the file to your computer!

Once that's done, double-click the file to open it and you should see two buttons within a yellow bar near the top of your screen. 'Enable Editing' is self-explanatory, and 'Enable Content' authorizes the app to retrieve data from the Internet (these two steps are also mandatory, but you will only have to do them once).  Afterwards, be sure and save the app on your desktop or in a folder where it will be easy to locate.

UPDATE! 

I recently discovered that for some users, Excel may 'BLOCK' the app since it contains macros.  If this happens on your computer, instead of a yellow bar at the top of your screen with the 'Enable Content' button in it, you will see a red bar with a 'Security Risk' warning in it and you will need to 'Unblock' the file if you want to use it as it was intended to be used. 

If you trust that I wouldn't spend three years building this app and go to all this trouble just to do something nefarious to your computer, you can follow this simple process to unblock it.  First, close the app and go to the folder where you saved the Excel file.  Next, right-click on the file and select 'Properties' to open another window.  Near the bottom of the 'General' tab, put a checkmark next to 'Unblock' and click 'OK'.  Now, open the app again and you should see the yellow bar with the 'Enable Content' button.  Clicking this is mandatory for the app to function as intended. 

If you're not comfortable taking these steps, then I'm sorry, but you won't be able to use the app. 

Contact me directly if you have any questions about this process.

Screenshot of the Canadian Retirement Income Planner (BC) home page.

After downloading and before you start using the app, you can watch a short introductory video on the 'Home' page by following the link called 'Click here first to watch a video!' or you can watch it now by clicking the hyperlink in this sentence.  The video explains a couple of steps you should take that will improve the 'look' of the app after you save the file to your computer.  There's a screenshot above that shows what the app home screen should look on your computer screen once you complete these two steps.

There's a Help button on the 'Home' page of the app if you need some guidance with the Personal Info and Financial Info buttons.  When you select either of these two buttons, they will launch separate forms (see above) with tabs on them so that you can enter all of your personal and financial data.  Using these forms is the only way data can be entered into the app.  When you click the 'OK' or 'Close' buttons, the data in the form will be transferred to the appropriate pages within the app and the form will clear.  I designed it this way so that you can update or make changes at any time.  Data cannot be entered on any of the other pages within the app and trying to do so will result in the app asking you to enter a password which you don't have.

I tried to keep the app simple so that it would be easy to use, while at the same time recognizing the possibility that there will be those who will need some guidance.  For this purpose, I created twenty-two videos (see images above) to provide help and support for various features of the app.  The videos are all embedded within the app and you will find links to them on 'Help' buttons located in the title bar at the top of most of the pages in the app. 

The first eight videos explain some of the more important aspects of the individual pages within the app.  The exception is the CPP & OAS page, perhaps the most important page in the app since it explains in great detail how your government pensions will work for you personally.  Here you will find a total of fourteen videos to assist you with understanding this relatively complicated aspect of your financial future.

Retirement is a relatively new concept in human history and didn't start to become widely accepted until sometime between the latter part of the 19th and early 20th centuries.  Before that, people had to earn their living right up to the time when they could no longer physically work, or they passed away.  Unfortunately, there are many seniors today who find themselves with no workplace pension, little or no personal savings, inflation running rampant, and only a government pension to sustain them in their twilight years.  Mandatory retirement in Canada ended in 2012, and many Canadians are now working past age 65 whether it's from necessity, love of career, a desire to stay busy, or other personal reasons.

I sincerely hope that the Canadian Retirement Income Planner will be useful tool for anyone who chooses to use it, and that it will give you some much needed insight into your future financial circumstances.

I wish you all the best with your retirement income planning.  Contact me directly if you have any questions or leave a comment below.

I welcome any comments as long as they are respectful.  I can handle criticism and opposing viewpoints, in fact I encourage them.  Join the discussion on any of my web pages.  Polite, courteous, or neutral comments will be published for everyone else to see.  Comments that are deemed rude, inappropriate, vulgar, hurtful, racist, misogynistic, violent, or sexual (among others) will not be published.  Remember, we can all agree to disagree and still be respectful!

'North Shore Retirement Income Planning', the 'Canadian Retirement Income Planner', and the 'North Shore Tax Data' website are copyright 2024 Mark Shaughnessy.