Questions to ask yourself before applying for your retirement pension
Should you apply for your retirement pension under the Québec Pension Plan (QPP) at age 65? You may be thinking of waiting until age 70 to apply, or you may be thinking of applying at age 60. Here are five questions to help you determine what is best for you.
Will my earnings be sufficient in retirement?
Verify whether your earnings will be sufficient to maintain your standard of living in retirement. The earnings will come from:
Will your pensions and savings be sufficient h to cover your financial needs for the rest of your life? It would be better to work longer and apply for your retirement pension under the
QPP later. Think about it: you could be retired for 30 years!
What is my state of health?
Are you in good health? Do you have good life habits? You should probably wait until age 65 to apply for your retirement pension under the
QPP, and even later. On the contrary, if you have health problems that reduce your life expectancy, you will benefit from applying for your pension earlier.
How will my retirement pension impact my income taxes?
The retirement pension under the Québec Pension Plan is taxable. This means that it is considered as income in the calculation of your taxes. It is therefore added to your other earnings, such as employment earnings. You can find out whether adding the retirement pension at the age at which you expect to retire benefits you. To do so, consult the
Québec 
and
Canadian tax rates, and the
Calculator of work income kept at retirement from the
Ministère des Finances.
Will I be able to receive the Guaranteed Income Supplement? If so, when should I apply for my retirement pension under the QPP?
Do you think you will need additional income to meet your needs from now until you reach age 65? Do you think you will be entitled to the Guaranteed Income Supplement (GIS) offered by the Government of Canada at that age? It may be advantageous for you to apply for your retirement pension under the QPP before you turn 65. Although your pension will be lower for life the GIS could compensate for part of the reduction.
Family income
Your spouse's income is taken into account in the calculation of the
GIS. Therefore, you may not be eligible for the
GIS, even if your personal retirement income is low.
How should I use my personal retirement savings (RRSP, TFSA, etc.)?
If you have personal retirement savings, it could be interesting for you to use them before applying for your retirement pension under the Québec Pension Plan. The savings could cover your financial needs at the beginning of your retirement, before you receive your pension. Are you a member of a workplace
defined‑benefit pension plan? This strategy could also benefit you if the income provided under this plan is sufficient.
The later you apply for your pension under the
QPP, the higher its amount will be for life. For the rest of your retirement, you will increase the portion of your income that is guaranteed and adjusted to the cost of living each year (indexed).
Applying for your retirement pension: an important decision!
Choosing the age at which you will begin receiving your pension is an important decision. The pension amount you will receive for life depends on it.
You have several options to help you make the best decision:
- Use the
SimulR tool to quickly estimate your retirement income.
- Use
CompuPension to:
- find out your income sources in retirement;
- find out how much you need to save;
- make informed decisions by comparing various scenarios.
- Consult your
Statement of Participation.
- Contact an expert on financial planning.
When you believe it is the best time for you, you must
apply for a retirement pension. You will not automatically receive your pension.
Other useful information