DiscoveryFinance.Com » OAS http://www.discoveryfinance.com Discovering Financial Strategies to Build Million Dollar Wealth Mon, 12 Jul 2010 23:07:39 +0000 http://wordpress.org/?v=2.8.1 en hourly 1 CPP: small plan, big potential?! http://www.discoveryfinance.com/cpp-small-plan-big-potential.html http://www.discoveryfinance.com/cpp-small-plan-big-potential.html#comments Thu, 11 Jun 2009 01:50:31 +0000 Ryan A. Smith http://www.discoveryfinance.com/?p=285 I checked my CPP Statement of Contributions just now. Sadly enough, I discover that I’m only eligible to receive a monthly retirement pension of $240, if I turned 65 this year and decided to receive CPP benefit. :( How am I supposed to survive with that petty amount. I spend about $200 each month on grocery, let alone the monthly $700 rent.

I wonder…what is the maximum CPP benefit that an eligible senior can get? Below is some info I find out about CPP.

Features of CPP

  • CPP is a pension for working in Canada, as opposed to OAS (Old Age Security) pension for living in Canada.
  • CPP contribution is compulsory for anyone who works in Canada.
  • In year 2009, the maximum CPP retirement pension is around $910 per month if taken at the age of 65. :(
  • CPP does not start automatically. You have to apply in order to receive it. This sounds a bit contradictory because your contribution is automatic and yet your pension is not automatic. :(
  • From my personal perspective, CPP should not be considered a benefit, because you “pay” for it through your contribution deducted from your pay cheques.
  • You can find out your CPP Statement of Contributions as well as your estimated CPP pension when you turn 65 on Service Canada website.
  • CPP contributions are tax-deductible; however, CPP pensions are taxable incomes. Sort of like “Tax-deferred”.
  • CPP contribution rates are 9.9% for self-employed and 4.95% for employee. (See contribution rate table)



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