How Much Do You Really Need to Retire in Canada?

It is one of the most common questions we've been asked: "How much do I actually need to retire?" The $1 Million number is a common one we hear. BMO’s 2026 Annual Retirement Survey says the number is $1.7 million. [1] Maybe someone has told you the rule that you need 70% of your pre-retirement income. The truth is, neither of these answers is complete on its own, and for many Canadians, they can be misleading.

Retirement planning is deeply personal. The right number for you depends on when you want to retire, what kind of life you want to lead, where you plan to live, and what other income sources you will have access to. Understanding what shapes your retirement number is the first step toward building a realistic plan.

The 70% Rule: A Starting Point, Not a Destination

Financial planning conversations often start with the idea that you will need about 70% of your working income in retirement. The thinking behind this is straightforward: your work-related expenses disappear (commuting, professional wardrobe, work lunches), your mortgage may be paid off, and your children are likely grown and financially independent.

For some Canadians, 70% is a reasonable estimate. But for others, particularly those who plan to travel extensively, support adult children, or maintain an active lifestyle, 70% may not be enough. For retirees who own their home outright, have modest tastes, and plan to spend their days close to home, it might even be more than needed.

The 70% rule is a useful conversation starter. It is not a finished plan.

The $1 Million Myth

The idea that $1 million is the magic retirement number has been circulating for decades. While it is not a bad aspiration, the number itself means very little without context.

A $1 million portfolio at age 55 is a very different situation than $1 million at age 70. How long your savings need to last, what kind of returns you can reasonably expect, and whether you carry debt into retirement all play a significant role in how far that money goes.

It is also worth remembering that most Canadians will have access to government benefits; the Canada Pension Plan (CPP) and Old Age Security (OAS). That reduces the total portfolio value they need to accumulate. If you and your spouse together receive $3,000 per month from government sources, that is $36,000 per year that does not need to come from your personal savings. Over a 25-year retirement, that adds up to $900,000 of income your portfolio does not need to generate on its own.

What Actually Determines Your Retirement Number

Rather than starting with a generic target, it helps to look at the actual variables that shape what you will need.

Your desired retirement lifestyle. The single biggest driver of your retirement number is how you want to live. A retired couple planning regular international travel and a second property will need considerably more savings than a couple who plans to spend time with grandchildren, tend a garden, and take occasional road trips. Neither is wrong, but they require very different financial plans.

Your other income sources. Most Canadians will receive CPP and OAS in retirement. If you have a defined benefit pension from an employer, that changes the picture significantly. Rental income, part-time work, or the proceeds from selling a business can all reduce what you need to draw from personal savings. A realistic retirement plan takes all of these sources into account.

Your timeline. If you want to retire at 55, your savings need to last potentially 35 to 40 years. If you plan to work until 67, your savings window is shorter, and your government benefits will be larger. The age at which you retire has an enormous impact on how much you need to accumulate.

Where you plan to live. Retiring in a paid-off home in a mid-sized Canadian city looks very different from renting in a major urban center or splitting time between Canada and another country. Cost of living in retirement is a factor many Canadians underestimate when they do their early planning.

Healthcare and long term care costs. As Canadians live longer, the possibility of needing care in later life is a real planning consideration. While Canada's public healthcare system covers a significant portion of medical expenses, private care, assisted living, and home support services can carry substantial costs. Building a buffer for these possibilities is part of a sound retirement plan.

A More Useful Approach

Rather than anchoring to a single number, think about building a retirement income plan. What does your monthly spending look like in retirement? What will you receive from government programs? What gap remains, and how large a portfolio do you need to fill that gap reliably?

Working through these questions with a financial advisor who understands your full picture gives you a much clearer and more actionable target than any general rule of thumb.

For example: if you determine you need $6,000 per month in retirement and will receive $3,000 per month combined from CPP and OAS, you need your savings to generate $3,000 per month. Working from there, with realistic assumptions about returns and your timeline, gives you a portfolio target that is specific to your situation, not a figure borrowed from someone else's life.

The Bottom Line

There is no universal answer to how much you need to retire in Canada. The right number is the one that supports the life you want to live, accounts for all your income sources, and gives you genuine confidence that your money will last as long as you need it to.

The best first step is getting clear on your own numbers and not someone else's rule of thumb. A financial advisor can help you work through the details and build a plan that fits your life.

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References

[1] BMO Financial Group (February 2026). "BMO Survey: Canadians Set Ambitious Retirement Goals Amid Rising Costs and Uncertainty." BMO Newsroom. newsroom.bmo.com

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Thinking About Your Next Step?

NXS Financial Strategies works with a small, select group of clients across Canada to build financial plans designed around real lives and real goals. If today's article got you thinking about your own retirement picture, you can apply to connect with our team at nxsfinancial.ca. If it looks like a great fit, we will be in touch.