The same contribution rate and benefit formula apply to all Canadians – outside of Quebec, which has its own Quebec Pension Plan. The actual cost of the benefits being earned, however, differs from province to province since cost is affected by many factors. One of the cost drivers is age; the younger the population the lower the cost. As the chart shows, Alberta is the second-youngest province, which means that Albertans have been paying more than their fair share into the Canada Pension...

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Investing in core exchange-traded funds (ETFs) with a fixed asset mix is about the most passive investment style you can choose. It doesn’t involve stock-picking or special asset classes like real estate, private equity or infrastructure. To make it even more plain vanilla, let’s eliminate the ability to shift money between asset classes to avoid a crisis or to take advantage of an opportunity in the market. One wouldn’t expect the returns from such a simple approach to compete favourably...

Canadians face the perennial question of when they should start their Canada Pension Plan benefits. In general, I recommend waiting until age 70, since it reduces inflation risk, investment risk and longevity risk. Nevertheless, there are years when it is better to start CPP at age 69 instead of 70. This was true last year, but will it be true in 2023 as well? While the following analysis focuses on 69-year-olds, it applies to anyone who is planning to start their CPP in January, 2024, and is...

Owning a house is a key element in retirement planning but affordability appears to be at an all-time low. The chart shows there is some truth to this perception. When measured in constant 2021 dollars (right-hand scale), mortgage payments have been higher in the past two years than at any time in the past half century. On the other hand, if we express mortgage payments as a percentage of median household income (for economic families), we find that paying off the mortgage was more difficult...