There are a lot of things to consider for retirement in Canada. For instance, how much you want to save for retirement, when you want to retire, where you want to retire, and how much your lifestyle will cost in retirement. All of these considerations can be quite exhausting, especially if you’re not sure which to consider first. In this article, we’ll explore some averages related to retirement, specifically the average retirement age in Canada. If you’re trying to figure out what the ideal retirement age is for you, continue reading!

What is the average retirement age in Canada?

Retirement is something many Canadians strive for! Although, it is a challenging feat to accomplish for various reasons. For starters, retirement is expensive no matter which way you slice and dice it. Stemming from the expensiveness is the time and resources to save enough to retire. Let’s take a look at some statistics regarding retirement in Canada.

For many Canadians, the retirement age has shifted in recent years due to the coronavirus. According to a study from the Ontario government, 23% of working Canadians believe the COVID-19 pandemic set back their retirement date. This was due to not having enough retirement funds. But on the other hand, some people have chosen to retire earlier than desired due to health and safety concerns surrounding the pandemic. 

On a broader scale, economic factors of the Canadian and global financial landscape have impacted the ability to afford retirement. For instance, inflation rates have been higher than usual in the past few years. High living costs leave little to save for retirement. In addition, home prices have been volatile and erratically high in recent years, some even deem it is a housing crisis. Putting money towards a mortgage is an effective way to save for retirement. However, many younger and middle age generations are unable to afford housing, which impacts their ability to afford retirement. According to CTV, just over half of Canadians feel unprepared for retirement and plan to work part-time in their golden years to make ends meet. 

The average retirement age in Canada is 65, which is the age that usually comes to mind when most think of retirement. However, many have doubts about retirement, may it be to the changing economy or limitations of their career. For this reason, the average retirement age in Canada may go up in the years to come.

At what age does the average Canadian retire?

Statistics Canada produces annual retirement ages by worker type. In 2022, the average retirement age in Canada was 65. The figure in 2019 was 64, so this number has not drastically changed since the pandemic. However, those who are in their 40s and 50s may be feeling the effects on their retirement plans more heavily than other demographics.

To be more specific, self employed individuals tend to retire at age 68. Public sector employees tend to retire around age 63. Their private sector counterparts tend to retire around age 65.

Related Reading: How Much Money Do I Need To Retire In Canada?

What is the healthiest age to retire?

Working comes with many stressors. There is definitely a connection between stress and illness, but it depends on the specific circumstances. Stress can be a good motivator in the short term. In addition, it is a natural part of life and we all incur it at some point or another. However, when you experience chronic, lasting stress, it can result in physical or psychological illness. 

If your job and coupled lifestyle comes with high, prolonged stress, then you may wonder if retiring at an earlier age will help you avoid illness. According to the New York Times, those who are healthy at age 50 can expect to have roughly 23 more years of good health. In other words, 73 is the average age which people can continue to work, without disability or illness. With advancements in medical technology that have increased the life expectancy, some believe the average age of retirement should actually increase.  

There’s life expectancy, but there’s also cognition. Yes, we may be able to physically work for longer, but what about our brains? Around age 45, the cognition of the prefrontal cortex begins to decline. However, if one continues to work, other areas of the brain can compensate. In addition, behaviors learned throughout a career tend to stick with us. So, if you learned the appropriate social and work behaviors, those habits can be relied upon. There is also a correlation between stopping to work and reduced brain function. When people stop working, they usually don’t use their minds as much which results in mental decline, and eventually physical decline too.

None of this really points into a general direction of what is the healthiest age to retire, unfortunately. However, it suggests that the longer people work, the healthier they will be both mentally and physically. But this is only true if the work you’re doing does not contribute to chronic stress. In addition, it assumes that the retiree will not replace their work with something equally as engaging, such as a hobby or volunteer work.

Ultimately, health is a very personal thing. Some people may experience health benefits when retiring earlier compared to others. But on the contrary, some may prefer to work longer, perhaps even into their 70s, and continue to lead healthy, active lives. 

Do you live longer if you retire early?

Working contributes to both mental and physical health in many ways. The World Health Organization reports that a job can contribute to livelihood, a sense of purpose, confidence and achievement, an opportunity to be engaged in a meaningful community, and a platform for a structured routine. All of these things contribute to greater mental health and cognitive functioning. However, the WHO also discusses how a job can be harmful to mental health. For instance, long work hours, toxic social environments, discrimination, unclear job roles, unreasonable workloads, and much more. 

So, what about the physical aspect? The same is true for physical health as it is for mental health. It can be beneficial for your physical health to stay in a job if the level activity is reasonable. But if it’s unhealthy or strenuous, it may not help your physical fitness. For instance, a tour guide may benefit physically from their job because it involves lots of walking and movement. Without that job, the tour guide might become less physically active. On the other hand, a desk job involves a lot of sitting and little physical activity which takes a toll on the body over time. 

At the end of the day, early retirement can have varying effects on health and life expectancy. It ultimately depends on your personal circumstances and what you’d do with your time if you did retire early. 

Related Reading: How To Retire Early In Canada

How much does the average Canadian need to retire comfortably?

On average, Canadians need to save about $756,000 to retire comfortably. More specifically, you will need 70% to 80% of your current annual income per year in retirement. You can estimate the amount you need to save by determining your annual income needs and forecasting it against your expected remaining years of life at retirement. Don’t forget to adjust for inflation!

How much does the average 65 year old have in retirement savings in Canada?

The average 65 year old individual or older has about $272,100 in retirement savings in Canada. Below are more statistics on the average amount of retirement savings, per Geny Money. 

Age Group	Retirement Savings (Individual)	Retirement Savings (Household)
Under 35 years old	$40,100	$90,500
35 to 44 years old	$89,700	$220,500
45 to 54 years old	$290,900	$437,400
55 to 64 years old	$377,300	$645,500
65 years and older	$272,100	$514,800

Related Reading: Top 10 Retirement Planning Tips For Canadians

Finding the Right Time to Retire

At the end of the day, retirement is a personal thing. Even though the average retirement age in Canada is 65, some may prefer to retire much earlier and others may enjoy working much later. It all depends on your chosen profession, job satisfaction, financial goals, and desired lifestyle. Finding the right time to retire is a very personal choice. Although one thing is certain, if you have a clear objective with regards to your retirement, you can most certainly work towards it!

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