CPP 2025 Key Numbers Parameter 2025 Amount Maximum monthly retirement pension (age 65) $1,364.60 Average monthly retirement pension ~$758 YMPE (Year's Maximum Pensionable Earnings) $70,900 (2025) Year's Basic Exemption $3,500 Employee contribution rate 5.95% Maximum annual employee contribution $4,034.10 CPP2 additional contribution threshold $73,200 When Should You Start CPP?

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The Canada Pension Plan (CPP) provides retirement, disability, and survivor benefits to Canadians who have contributed during their working years. The maximum CPP retirement benefit in 2025 is $1,364.60 per month at age 65. However, the average monthly payment is significantly lower — around $758. Use our calculator below to estimate your benefit.

CPP Retirement Benefit Estimator

Years of CPP Contributions (max 39 contributory years) Average Annual Employment Income ($, over contributory years) Age You Plan to Start CPP

CPP Start Age Comparison

Estimated CPP at Age 65 ($/ month)

How CPP Retirement Pension Works

The Canada Pension Plan is a contributory, earnings-related social insurance program. Your CPP retirement pension is calculated based on:

Contributory period: From age 18 to when you start CPP (up to age 70), minus dropout provisions
Earnings relative to the YMPE: The Year's Maximum Pensionable Earnings (YMPE) is $68,500 in 2024. Only earnings up to this cap generate CPP contributions
Contribution rate: Employees contribute 5.95% of insurable earnings (2024), matched by employers

CPP 2025 Key Numbers

Parameter	2025 Amount
Maximum monthly retirement pension (age 65)	$1,364.60
Average monthly retirement pension	~$758
YMPE (Year's Maximum Pensionable Earnings)	$70,900 (2025)
Year's Basic Exemption	$3,500
Employee contribution rate	5.95%
Maximum annual employee contribution	$4,034.10
CPP2 additional contribution threshold	$73,200

When Should You Start CPP?

This is one of the most important retirement decisions Canadians make. The options and tradeoffs:

Start at 60: Benefit reduced by 7.2% per year early (36% total reduction). Best if you have health concerns or urgent income needs.
Start at 65: Standard benefit. Appropriate for average health and financial situation.
Start at 70: Benefit increased by 8.4% per year delayed (42% total increase). Best if you are healthy and have other income sources in early retirement.

  Breakeven analysis: If you delay CPP from 65 to 70, the breakeven point is roughly age 82. If you live past 82, delaying to 70 pays more in total lifetime benefits.

CPP Dropout Provisions

CPP includes provisions that automatically drop out low-earning periods from your calculation, helping most Canadians:

General dropout: Your lowest 8 years of earnings are automatically excluded
Child-rearing dropout: Years spent raising children under 7 (when income was low/zero) can be excluded
Disability dropout: Periods of disability can be excluded

CPP Enhancement (CPP2)

Since 2019, the CPP has been enhanced in two phases. The CPP2 enhancement (2024-2025) adds a second earnings tier for income between the YMPE ($68,500) and the new Year's Additional Maximum Pensionable Earnings ($73,200 in 2025). Both employees and employers contribute 4% on this additional tier. Workers who contribute to CPP2 will receive higher benefits in retirement.

CPP Survivor and Disability Benefits

CPP also provides:

Disability benefit: For those under 65 who are severely disabled. Maximum 2025: $1,620.64/month
Survivor's pension: Paid to the surviving spouse/partner of a CPP contributor
Death benefit: One-time lump sum of up to $2,500
Children's benefit: For dependent children of disabled or deceased CPP contributors

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