CPP Changes on the Horizon

The federal government announced some proposed changes to CPP making it more onerous to take CPP early while rewarding those who delay their start date past the date of 65.

It has barely received any press coverage yet it will impact every Canadian outside of those already collecting their pension.

The major change will be that CPP payments will be reduced by 0.6% for each month prior to 65 that payments are received. A recipient that decided to take their pension at 60 would normally have had their full pension reduced by 30% (0.5% * 60 months) . Now, the reduction in payments will be calculated as follows: (0.6% * 60 months) = 36% reduction.

The benefit to delaying a pension however is more lucrative. Under the current payment structure, a recipient receives 0.5% more for each month that the CPP is delayed past 65 years of age. That amount will increase to 0.7% per month or 8.4% per year that a Canadian delays taking their payments.

You can get more details on the proposed changes by clicking here.

Your thoughts on the proposed changes to CPP are welcome.

Have a Great Weekend.

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3 Responses

  1. […] Read the rest of this great post here […]

  2. The Liberal Party has been looking for a reason to bring down this Conservative Government. These changes to the CPP which will have a negative effect on all working Canadians who hope to retire at age 60.

    Michael Ignatiff this is your opportunity to remove this right wing government. Call an election in the fall.
    The baby boomers who form the biggest voting block will support your opposition to these CPP changes in large numbers.

  3. Notify me of follow up comments please
    maurice Moore

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