Retirement Planning in Your 60s in Canada 2025

Your 60s are decision decade. CPP start age, OAS deferral, RRSP conversion, pension income splitting, RRIF setup — the major retirement income decisions all land in this decade. Getting them right can be worth $100,000+ in lifetime income.

Your 60s mark the transition from accumulation to decumulation — from saving to spending. The financial decisions you make in this decade are among the most consequential of your life. Unlike your 50s (still time to course-correct), your 60s require you to execute a plan with real money and real consequences. Here's how to navigate it.

Early 60s (60–64): The Pre-Retirement Phase

CPP Decision: Take It or Wait?

At 60, you first become eligible for CPP. The temptation is real — but taking CPP at 60 means a permanent 36% reduction. For most Canadians in their early 60s who still have other income (part-time work, savings), waiting is usually better. However, if you've retired early and need the income, starting CPP at 60 or 62 may make sense.

Key question: Do you need the income NOW? If not, every year you wait between 60 and 70 increases your lifetime CPP income.

RRSP Drawdown Strategy

Many Canadians make the mistake of leaving their RRSP untouched until age 71 (mandatory RRIF conversion). But strategic drawdowns in your early 60s — before CPP, OAS, and RRIF minimums stack up — can save significant tax:

If you've retired at 60 with low income, draw RRSP at low marginal rates (20% range)
Reduces RRIF balance at 71, lowering future mandatory minimums
Prevents income from spiking into high brackets in your 70s
Converts taxable RRSP into tax-free TFSA (invest RRSP proceeds in TFSA after tax)

Convert Part of RRSP to RRIF at 65

You don't need to wait until 71 to open a RRIF. Converting a small amount at 65 lets you start qualifying for the pension income tax credit ($2,000 eligible income = ~$300 federal credit). Pension income splitting also opens up for RRIF income at 65.

Mid 60s (65–67): The Retirement Launch

OAS Starts at 65 — Should You Defer?

At 65, you become eligible for OAS (~$727/month in 2025). If your income is high between 65–70 (still working, large RRIF/pension), consider deferring OAS to reduce clawback exposure and earn the 7.2%/year deferral bonus. If you need the income or your income is moderate, take it at 65.

Apply for CPP if You Haven't

Many Canadians who didn't take CPP at 60 choose to start at 65, the standard age. Apply 6–12 months before your 65th birthday through My Service Canada Account. CPP is not automatic — you must apply.

Pension Income Splitting

If you've converted RRSP to RRIF or are receiving RPP income, and your spouse has lower income, start pension income splitting. Claim the pension income tax credit on both returns (up to $2,000 each). This single strategy can save $500–$5,000/year depending on your income gap.

Review Your Asset Allocation

In retirement, your portfolio needs to balance growth (to last 25–30 years) with stability (to fund near-term withdrawals). A classic approach: keep 1–2 years of living expenses in cash/GICs, the rest invested in a diversified portfolio. Avoid being either too aggressive (sequence-of-returns risk) or too conservative (inflation erodes purchasing power).

Late 60s (68–71): The Optimization Window

RRIF Conversion by Age 71

You must convert your RRSP to a RRIF (or annuity) by December 31 of the year you turn 71. Don't wait until December — convert in mid-year to ensure proper processing. If you haven't done strategic drawdowns in your 60s, your RRIF minimums will be significant.

CPP Maximum: Take It by 70

Age 70 is the last date to start CPP — there's no benefit to waiting longer. If you deferred, apply 6 months before your 70th birthday. Your 42% enhancement over age 65 is locked in for life.

OAS Maximum: Also Deferred to 70

If you deferred OAS, it must start by age 70 (Service Canada will auto-enroll). Your 36% enhancement over the age-65 amount is permanent and inflation-indexed.

The Retirement Income Sequence: A Framework

Age	Recommended Income Sources
60–64	Part-time work + RRSP drawdown + TFSA
65–69	CPP (if started) + OAS (if started) + RRIF minimum + TFSA
70+	Maximum CPP + Maximum OAS + RRIF minimums + TFSA as needed

Sequencing matters: Spend registered money (RRSP/RRIF) during low-income years in your 60s, and lean more on TFSA and non-registered accounts once CPP, OAS, and RRIF minimums are all flowing — to avoid stacking too much taxable income.

Healthcare and Long-Term Care Planning

In your 60s, healthcare becomes a real financial consideration. Key questions:

Will you have employer health benefits in retirement, or do you need private coverage?
Do you have a plan for potential long-term care costs ($3,000–$100+/month)?
Have you considered long-term care insurance?
Is your home accessible if mobility becomes an issue?

Stretch Your Retirement Income Further

KOHO's no-fee banking helps Canadian retirees stop paying $15-$30/month in bank fees. Keep more of your CPP and OAS in your pocket. Use code 45ET55JSYA for a bonus.

Get KOHO Free — Use Code 45ET55JSYA

Estate Planning in Your 60s

Your 60s are the time to finalize estate planning:

Update your will — especially if circumstances have changed
Ensure beneficiaries are named on all registered accounts and insurance
Set up Powers of Attorney (property and personal care)
Consider whether joint ownership of assets with a spouse makes sense
Discuss your wishes for end-of-life care