Canadian retirement-income planning

Pension Gap Calculator Canada

See how much of your desired retirement income may be covered by CPP or QPP, OAS, a workplace pension and other predictable income—then measure how much personal savings must bridge the remaining gap.

The result separates your pension gap before personal savings from the final income and capital position after projected savings are included. It also identifies the most practical contribution, retirement-age or lifestyle adjustment to test next.

Gross income basis Today’s dollars CPP / QPP + OAS Savings drawdown
Consistent income basis Target income and pension estimates are entered before tax in today’s dollars.
Separate income and capital decisions A monthly retirement gap and a retirement-capital shortfall are related, but they are not the same result.
Action-based result The recommendation uses contribution, timing, fee or lifestyle changes—not a higher assumed investment return.
Methodology reviewed: June 2026

This is an educational retirement-planning estimate, not an official CPP, QPP, OAS, workplace-pension, tax, actuarial, investment or financial planning calculation. Verify pension amounts using official statements before making a retirement decision.

Review assumptions

Enter gross monthly amounts in today’s dollars

Use retirement-income and pension estimates before tax. Taxes, account-specific withdrawal treatment and detailed RRSP, RRIF or TFSA withdrawal ordering are not included in the core estimate.

Build your retirement plan

Start with the retirement timeline, income target, verified pension estimates and personal savings already available.

10 core inputs
Retirement timeline Define how long savings can grow and how long retirement income may need to last.
years
Your age today.
years
When employment income is expected to stop or materially decline.
years
A planning horizon, not a prediction of lifespan.
Retirement-income target Set the gross monthly lifestyle income you want in today’s purchasing power.
/ month
Enter the before-tax monthly income you want your retirement plan to support in today’s dollars.
Predictable monthly retirement income Include only income supported by an official estimate, pension statement or other reasonably dependable source.

Do not enter generic maximum benefit amounts unless they match your personal records. CPP/QPP, OAS and workplace-pension amounts can vary materially by contribution, residence, claiming age and plan rules.

/ month
Use the latest official statement or personal retirement estimate.
/ month
Enter a conservative estimate based on expected residence and eligibility.
/ month
Use the most recent pension statement, including only the amount expected at the selected retirement age.
/ month
Include only dependable recurring income. Do not include unverified GIS or uncertain employment income.
Personal savings plan Add savings already available for retirement and the amount currently contributed each month.
Include only assets intended to fund retirement. Exclude your emergency fund and money reserved for other major goals.
/ month
Use your current combined retirement contribution across applicable accounts.
Advanced assumptions Adjust returns, inflation, fees, contribution growth, pension indexing and retirement-income timing.

Higher assumed returns can make a plan appear stronger without making it safer. The recommendation engine will not use a higher investment return as the primary fix.

Investment and inflation assumptions Accumulation and retirement drawdown use separate return assumptions.
%
Expected gross annual return while savings are accumulating.
%
Used to estimate sustainable retirement withdrawals and capital required.
%
Converts future balances and income into today’s purchasing power.
%
Includes investment-management and product costs applied to the projected portfolio.
Savings and pension growth Model contribution increases and the purchasing-power effect of pension indexing.
%
Increases the monthly contribution once per year until retirement.
% / year
Leave at 0% unless your pension statement confirms annual indexing.
% / year
Use only when the other predictable income has a documented adjustment rule.
Optional lump sum added to retirement savings immediately.
Retirement drawdown and income timing Set a legacy target and identify when each predictable income source is expected to begin.
Real capital you want left at the selected planning age.
/ month
Enter only a personally verified amount. It uses the Other-income start age and indexing assumption below. Eligibility is not estimated automatically.
years
Use age 60–70 for CPP. QPP may begin from age 60 and can increase until age 72.
years
OAS can begin from age 65 to age 70. The model applies the permanent 10% age-based increase after age 75.
years
years
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Quick planning notes

Before calculating

A pension statement is more useful than a generic maximum benefit amount.

Pension gap before savings is not the same as the final retirement-income shortfall.

A longer retirement horizon requires more capital even when the monthly target does not change.

Higher assumed returns are a sensitivity—not a reliable primary repair strategy.

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How to use the pension-gap result

Start with documented pension estimates, keep every main amount on the same gross and today-dollar basis, then use the result to test a real retirement decision rather than searching for the most optimistic output.

1

Set a realistic income target

Enter the gross monthly retirement income needed to support the lifestyle you are actually planning. Do not mix an after-tax spending target with before-tax CPP, OAS or workplace-pension amounts.

2

Use personal pension estimates

Enter CPP or QPP, OAS and workplace-pension amounts from recent statements. Generic maximum benefits can materially overstate the dependable income available to your plan.

3

Separate pensions from personal savings

First review the pension gap before savings. Then examine how much monthly income projected savings can support and whether any final shortfall remains.

4

Test the recommendation under stress

Compare the Best Fix with a lower-return case, a longer retirement horizon and a pension-income reduction before treating the base result as dependable.

What your pension-gap result actually means

A retirement-income result is useful only when the monthly income story and the capital story agree.

The verdict is about the complete bridge

CPP or QPP, OAS and a workplace pension may cover a meaningful share of the target without fully funding retirement. Personal savings must then support the remaining income over the selected retirement horizon.

A strong result means the plan reaches the income target, projected real savings are sufficient for the required drawdown and reasonable stress tests do not immediately create a major shortfall.

01

Monthly shortfall

Shows the retirement income still missing after predictable pensions and sustainable savings withdrawals are included.

02

Capital shortfall

Shows how far projected real savings are below the capital required to fund the pension gap through the selected planning age.

03

Coverage margin

Shows whether the target is merely reached under the base assumptions or supported with enough room for weaker returns, higher inflation or a longer retirement.

Pension gap before savings versus final income gap

These values answer different questions and should never be presented as interchangeable.

Before personal savings

Pension-income gap

Target income − predictable pension income

This shows how much monthly lifestyle income CPP or QPP, OAS, workplace pension and other dependable sources do not cover on their own.

After personal savings

Final retirement-income gap

Target income − pensions − savings-supported income

This is the amount still missing after projected retirement capital is converted into a sustainable real monthly withdrawal.

A large pension gap does not automatically mean the plan fails.

The pension gap may be fully bridged by personal savings. Conversely, a modest monthly pension gap may still require substantial capital when the retirement horizon is long.

How CPP or QPP, OAS and workplace pensions fit together

Predictable income forms the stable foundation of the retirement bridge, but each source follows different eligibility, timing and indexing rules.

01

CPP or QPP

Use a personal estimate based on your contribution history and intended start age. The calculation does not assume the maximum public-pension amount.

Enter the amount expected at the selected start age.
02

Old Age Security

OAS should be entered conservatively because expected residence history, start age and income circumstances may affect the amount received.

GIS is excluded unless a personally verified amount is entered.
03

Workplace pension

Use the latest employer or plan statement. Confirm whether the pension is fully indexed, partially indexed or fixed because that distinction can materially change future purchasing power.

Non-indexed income gradually loses real value during retirement.
04

Other predictable income

Include recurring income only when its amount, start date and duration are reasonably dependable. Temporary work income or uncertain benefits should not be used to repair a long-term retirement gap.

Uncertain income belongs in a scenario, not in the base plan.

A more focused CPP Retirement Pension Estimator Canada can be used before entering the public-pension amount in this plan.

How personal savings bridge the pension gap

Retirement savings do not simply replace the entire account balance with income. The portfolio must support withdrawals across the selected retirement horizon while investment returns, inflation and fees continue to affect the balance.

Current capital Existing retirement savings

Assets already assigned to retirement provide the starting foundation.

Accumulation Contributions and investment growth

Monthly contributions, contribution increases, returns and fees determine the projected balance at retirement.

Drawdown Supported monthly retirement income

Projected real savings are converted into a level monthly withdrawal over the selected retirement period.

Savings needed for emergencies, debt repayment, a home purchase or another major goal should not be counted as retirement capital merely to improve the result.

Capital required and retirement drawdown

Capital required is the value at retirement of the future monthly income that personal savings must provide.

Constant real gap

Present value of retirement withdrawals

Capital required = monthly pension gap × annuity factor

When the real monthly return is zero, the model uses the monthly gap multiplied by the number of retirement months, plus any desired ending balance.

Changing real gap

Month-by-month discounted cash flow

Capital required = sum of discounted future monthly gaps

When pensions begin at different ages or lose purchasing power because they are not fully indexed, the engine recalculates the gap for each retirement month.

After identifying the required capital, use the Retirement Withdrawal Planner Canada to examine a dedicated withdrawal path and balance sustainability over time.

Inflation, pension indexing, fees and return assumptions

A retirement plan can show a large future balance while still losing purchasing power. The decision therefore uses real values after fees and inflation.

Inflation

Inflation increases the future-dollar cost of maintaining the same lifestyle. Main comparisons are converted back into today’s dollars.

Investment return

Separate assumptions are used before and during retirement. A higher return can improve the projection, but it cannot become the recommended repair.

Investment fees

Fee drag includes both fees removed from the portfolio and the future growth those amounts no longer earn.

Pension indexing

A non-indexed workplace pension may remain unchanged in nominal dollars while covering progressively less of the target in real terms.

The Investment Return vs Inflation Calculator Canada provides a separate view of nominal growth, fees and real purchasing-power growth.

How to make a retirement decision

Use the smallest realistic change that materially improves both the base result and its resilience under stress.

01

Verify the foundation

Confirm public and workplace-pension estimates before changing savings behaviour around an uncertain number.

02

Repair the main shortfall

Test the calculated contribution increase, retirement delay or target reduction rather than making several unmeasured changes.

03

Protect against the dominant risk

If a lower-return or longer-retirement case breaks the plan, create a margin instead of accepting a result that works only under one forecast.

04

Choose the account separately

Decide how much needs to be saved before deciding whether the next contribution belongs in an RRSP, TFSA or another account.

When the Best Fix requires additional savings, compare the account-level tradeoffs with the TFSA vs RRSP Comparison Calculator Canada .

Real Canadian pension-gap scenarios

Similar account balances can produce very different decisions depending on pension coverage, years to retirement, indexing and the lifestyle target.

Strong pension foundation

Workplace pension covers most of the target

Target
$4,800/month
Predictable pensions
$4,050/month
Personal savings
$95,000

The pre-savings pension gap is only $750 per month. Even a modest savings portfolio may bridge it, but the workplace pension’s indexing rules remain the Biggest Risk.

Decision takeaway

Verify indexing before increasing contributions beyond what the capital gap actually requires.

Savings-led plan

Good savings with no employer pension

Target
$5,200/month
CPP/QPP and OAS
$1,850/month
Projected real savings
$910,000

The pension gap before savings is large, but the projected portfolio supports most or all of the remaining income.

Biggest Risk

The result depends more heavily on market returns and withdrawal sustainability than a pension-led plan.

Mid-career repair

A manageable contribution gap

Current age
44
Current contribution
$650/month
Additional amount needed
$240/month

With more than 20 years before retirement, a moderate contribution increase may close the capital shortfall without changing the retirement age or income target.

Decision takeaway

An early measured adjustment is usually less disruptive than waiting until the final years before retirement.

Late-start pressure

Limited accumulation time

Current age
59
Retirement age
65
Capital shortfall
$210,000

A large contribution increase may be mathematically possible but practically unrealistic because only six years remain for contributions and compounding.

Decision takeaway

A combined repair—smaller contribution increase plus a retirement delay—may be more realistic than relying on one extreme change.

Return-dependent plan

The target works only at an aggressive return

Return assumption
8.0%
Lower-return stress
6.5%
Stress gap
$620/month

The base case appears funded, but a reasonable reduction in investment performance creates a material shortfall.

Biggest Risk

The retirement decision depends on the forecast rather than on sufficient savings or dependable pension income.

Indexing pressure

A fixed workplace pension loses purchasing power

Workplace pension
$2,200/month
Indexing
0%
Planning age
94

The pension provides strong income at retirement, but its real value declines while the lifestyle target remains expressed in today’s dollars.

Decision takeaway

Personal savings may be needed later in retirement even when the starting pension appears sufficient.

Longevity stress

The plan works to age 90 but not age 95

Base planning age
90
Stress planning age
95
Coverage decline
13 percentage points

Five additional retirement years increase the required drawdown period and leave less monthly income available from the same capital.

Decision takeaway

Treat planning age as a risk horizon rather than shortening it merely to obtain a positive result.

Pension-covered target

Predictable income already reaches the goal

Target
$4,300/month
Predictable income
$4,550/month
Future contribution required
$0/month

CPP/QPP, OAS and workplace pension cover the target without relying on portfolio withdrawals under the entered assumptions.

Decision takeaway

Maintain the current plan, verify the pension statements and use personal savings as margin rather than inventing a new contribution target.

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Common pension-gap planning mistakes

Most misleading retirement results come from inconsistent inputs or optimistic assumptions rather than from the final formula itself.

01

Using after-tax spending against gross pension income.

02

Comparing a future nominal balance with a target in today’s dollars.

03

Treating the pension gap before savings as the final shortfall.

04

Assuming maximum CPP or QPP without checking personal contributions.

05

Assuming full OAS without considering residence or income circumstances.

06

Including GIS without verified eligibility and amount.

07

Ignoring whether a workplace pension is indexed.

08

Using a higher investment return as the main repair strategy.

09

Multiplying the monthly gap by retirement years without a drawdown model.

10

Ignoring investment fees and the growth lost to those fees.

11

Counting savings that are needed for emergencies or another major goal.

12

Shortening the planning horizon only to make the result look funded.

13

Forgetting that taxes and withdrawal sequencing can change spendable income.

14

Treating a planning estimate as actuarial certainty or regulated advice.

How the pension-gap calculation works

The calculation has four connected stages: predictable pension income, savings accumulation, retirement drawdown and decision testing.

Stage 1

Calculate predictable income

CPP or QPP, OAS, workplace pension, other predictable income and any verified benefit are combined according to their selected start ages.

Stage 2

Project personal savings

Current savings, a one-time contribution and monthly contributions grow until retirement using the after-fee investment return. A parallel no-fee path measures fee drag.

Stage 3

Model retirement drawdown

The engine calculates the real monthly withdrawal projected savings can support and the capital required to fund the pension gap through the selected planning age.

Stage 4

Test the decision

The result is compared with contribution, retirement-age, target, fee, longevity, return and pension-income scenarios using the same calculation engine.

Pension gap before savings Target income − predictable pension income
Total projected retirement income Predictable income + savings-supported income
Final monthly position Target income − total projected retirement income
Capital position Projected real savings − capital required
Real return (1 + nominal return after fees) ÷ (1 + inflation) − 1

What is included and excluded

The model is intentionally deep enough to support a retirement-capital decision without pretending to replace tax, actuarial or personalized financial planning.

Included

  • CPP or QPP estimate
  • OAS estimate
  • Workplace-pension income
  • Other predictable retirement income
  • Current retirement savings
  • Monthly and one-time contributions
  • Contribution growth
  • Separate accumulation and retirement returns
  • Investment fees and inflation
  • Pension indexing
  • Real capital required
  • Desired ending balance
  • Contribution, timing and lifestyle scenarios

Excluded

  • Official CPP, QPP or OAS entitlement calculation
  • Automatic GIS eligibility
  • Detailed personal income tax
  • OAS recovery-tax calculation
  • RRSP, RRIF and TFSA withdrawal ordering
  • Spousal tax and pension optimization
  • Account-specific withholding tax
  • Market sequence simulation
  • Actuarial mortality probabilities
  • Guaranteed investment performance
  • Regulated investment or financial advice

Verify pension estimates with official sources

The quality of the result depends on the quality of the pension inputs. Use recent personal statements rather than generic benefit examples.

Government of Canada

CPP estimates in My Service Canada Account

Review personal CPP benefit estimates and the official Statement of Contributions.

Visit official source Government of Canada

Old Age Security eligibility

Review age, residence and income considerations before entering an OAS estimate.

Visit official source Retraite Québec

Québec Pension Plan

Confirm QPP rules and use personal Québec pension information where applicable.

Visit official source Government of Canada

Canadian Retirement Income Calculator

Compare the NumeraHub planning result with the federal retirement-income planning resource.

Visit official source

Methodology and assumptions

The methodology is designed to keep retirement-income and retirement-capital conclusions internally consistent.

Reviewed June 2026

Income basis

Core income values are gross before-tax monthly amounts expressed in today’s dollars.

Accumulation timing

Contributions are added monthly until retirement and may increase once per year using the selected contribution-growth assumption.

Return after fees

Investment fees are incorporated into the net return before inflation is removed to calculate real growth.

Retirement drawdown

Capital required is based on discounted monthly retirement-income gaps, not an arbitrary multiple of annual spending.

Pension indexing

CPP and QPP annual indexing and OAS quarterly CPI adjustments are approximated as constant real purchasing power. The model also applies the permanent 10% OAS increase after age 75. Workplace-pension and other income follow the indexing assumptions entered.

Planning age

The selected final age defines the modelled retirement duration. It is not a prediction of lifespan.

Scenario testing

All six scenarios call the same PensionCoverage™ engine and are deduplicated by changed-input signature.

Planning limitations

Taxes, withdrawal sequencing, detailed benefit eligibility and full sequence-of-returns simulation are outside the core model.

Educational planning estimate

Results depend on the values entered and cannot predict investment returns, inflation, pension-plan changes, tax outcomes or lifespan. Revisit the plan when income, savings, pension estimates or retirement timing changes.

Pension Gap Calculator Canada FAQ

Practical answers about pension income, personal savings, inflation, retirement capital and the limits of the calculation.