Retiring in the U.S. vs Canada: The Real Cost

Should you retire in Canada or the U.S.?

For a lot of cross-border families, it looks simple. Canada has healthcare. The U.S. has lower taxes.

But once you run the numbers, it gets messy fast. I’m Christopher Liew, CFA and CFP professional, and at Blueprint, this is exactly the kind of planning we help families work through.

By the end of this blog post, you’ll see why the right answer depends less on the country, and more on the kind of retiree you are.

Income Tax

Let’s start with the number everyone moves for. Income tax.

Two quick notes on the matchup. I’m using Florida, the most popular destination for Canadian snowbirds, as the stand-in for the whole low-tax-state playbook. Texas, Nevada, low-tax Arizona, same idea. It’s no accident retirees flock to these states. This is a big reason. 

And on the Canadian side, I’m using Ontario. Two reasons. It’s by far the most populous province, so it’s where most of you actually live. And on taxes, it sits right in the middle of the pack, not the highest like the Atlantic provinces, not the lowest. A fair stand-in for the typical Canadian retiree.

Florida has no state income tax. Canada stacks federal on top of provincial. So here’s what one retiree actually pays. Same income, two addresses.

Income tax table

*One retiree. Ontario (federal + provincial) vs. Florida (US federal only, no state tax). Single filer. FX 1.39.

Ontario + federal 2026 brackets · US single-filer 2026 brackets + $16,100 standard deduction

At $60,000, Ontario takes about $9,400. Florida, around $4,200. You save $5,200. At $100,000, Ontario’s bill is $21,500, Florida’s under $10,000, that’s $11,800 back in your pocket. At $150,000, Ontario takes $41,600, Florida $20,700, a $20,900 gap.

And it just keeps widening. At $250,000, Ontario wants $89,500. Florida, $44,300. You keep an extra $45,000. Every year. At the top, half a million in income, Ontario takes nearly 45 cents on the dollar, $223,000, gone. Florida, $124,000. You pocket almost $100,000 more. A year.

That’s the whole appeal. The more you earn, the more Florida saves you. Canada takes a bigger bite the higher you climb. Florida just doesn’t climb.

One note. A Florida retiree still pays U.S. federal tax, that’s already in these numbers. What vanishes is the provincial layer. And not every state is this kind, California or New York pile a hefty state tax right back on. But the popular retirement states aren’t the expensive ones.

So on paper, the U.S. wins this round. Easily.

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Housing

Now let’s talk about the roof over your head. 

The average Canadian home runs about $690K, and in Toronto or Vancouver, north of a million. Sell either, and you can land in Florida for around $400K US. Same money, a lot more house. Or a big pile left over for the rest of your retirement.
All figures in CAD. Florida converted at 1.39.

Home prices: CREA (national avg ~$690K), Ontario REA (Ontario avg ~$840K), Redfin (FL median ~$400K US). Property tax: Tax Foundation (FL 0.78%), City of Toronto / iFinance (ON ~0.75–1.0%). Insurance: MyChoice (ON ~$1,500), Insurify (FL highest in US).

The home price tells the first half of the story. The average Ontario home is around $840,000. In Toronto, it’s over a million. In Florida, you can replace it for roughly $550,000 Canadian. Sell up north, buy down south, and you could free up hundreds of thousands overnight.

Property tax? Surprisingly close. Both sides are generally under about one percent of the home’s value, so that’s not usually what decides this.

Insurance is.

Florida has the most expensive home insurance in America, around $7,000 U.S. a year, and on the coast it can blow past ten grand. Canada is closer to $1,500. And this is already pushing Canadians out.

Cedrone interview, lower-third chyron with on-record quote.]

CBC covered this last year: weak loonie, rising insurance, and snowbirds selling homes they’d owned for years. One Ontario retiree saw her condo insurance climb past $16,000 U.S. a year before selling.

And this is why the state matters. Arizona has sunshine too, but no hurricanes or coastal flooding. Same country, very different bill.

So yes, the sticker price down south can be a steal. Just remember: in Florida, the house is cheap. Keeping it insured is not.

This round still goes to the U.S. Home prices can be dramatically cheaper, but keep one eye on the insurance bill and the state you choose.

Healthcare

In the U.S., Medicare helps, but it’s not free. Part B runs $202.90 a month in 2026, with a $283 deductible. Then a drug plan, maybe a Medigap policy. And here’s what people miss. Original Medicare has no annual out-of-pocket cap. None. Your exposure is open-ended. And if you’ve got pre-existing conditions, the supplemental coverage that caps that risk can cost a lot more, or turn you down outright.

Healthcare cost table

One retiree, 65+, 2026. US in USD (CAD at 1.39).

Here’s the number that should stop you. Fidelity estimates a 65-year-old will spend $172,500 on healthcare over retirement, $345,000 for a couple. And that’s before dental, before long-term care.

One catch most Canadians miss. You can’t just retire to Florida and get Medicare. You need a green card, plus about 10 years of U.S. work for premium-free Part A, or five years’ residency to buy in, at up to $565 a month. It’s not a given. It’s something you qualify for, and pay for.

In Canada? Hospital and doctor care is covered. Out-of-pocket runs around a couple thousand a year, mostly dental and drugs. But that coverage comes with a cost of its own, time. Wait lists are real, and for a hip, a knee, or a non-urgent surgery, you may wait months longer than you would paying out of pocket down south.

So the real trade-off is simple. In Canada, the risk is waiting. In the U.S., the risk is the bill. But on pure dollars and cents? Canada wins this round, easily.

Retirement Pensions: Social Security vs CPP & OAS

Good news first. Your CPP and your U.S. Social Security are both fully portable. You paid in your whole working life, and they’ll find you wherever you land, Toronto, Tampa, anywhere.

OAS is the one that trips people up. It comes with two strings Social Security doesn’t. First, residency: you need 10 years in Canada as an adult to collect it, but the moment you move abroad, that jumps to 20. Fall short, and your OAS switches off six months after you leave. Second, the clawback. Stay in Canada with a higher income, and once you cross about $95,000, the government starts taking OAS back at 15 cents on every dollar above that line. Social Security has nothing like it.

Here’s where it gets backwards. Meet David. Retired, $130,000 a year in income, collecting full OAS. If David stays in Ontario, that income pushes him well past the clawback line, and a big chunk of his OAS gets quietly taken back. But if David retires in Florida, two things happen. 

He’s now a non-resident, and the Canada-U.S. treaty drops Canada’s withholding on his CPP and OAS to zero. And because that rate sits below the 25% line that triggers the clawback for non-residents, the recovery tax stops applying too. Same David, same income, keeps every dollar of his OAS.

Sit with that. A higher-income retiree can keep more of his Canadian pension by leaving Canada than by staying. It’s not a loophole, it’s written into the treaty, and it’s exactly why OAS deserves real planning, not a guess.

So who takes this round? For a higher-income retiree like David, it’s the U.S., and it’s not close.

Whether Canada or the U.S. wins for you comes down to your exact income mix, and one wrong call on OAS or the treaty costs real money. At Blueprint, cross-border planning is what we do all day, in plain English. Book a discovery call. Build the life you want, with the right Blueprint.

Estate Planning

Now for my favourite myth. Canada has no estate tax, the U.S. does, so Canada wins, right? Technically true. Practically, it’s often backwards.

Yes, the U.S. has an estate tax. But in 2026 the exemption is $15 million per person, so unless you’re extremely wealthy, your American estate pays nothing. And the U.S. throws in a step-up in basis, your heirs inherit your assets at today’s value, so decades of capital gains get wiped clean.

This assumes you’ve actually become a US resident for tax purposes. If you keep Canadian domicile but own US property, the US can tax that property at a much lower threshold, so get advice before you assume you’re covered.

Canada has no estate tax either. But don’t celebrate yet. When you die here, the government treats it as if you sold everything the day before, triggering every capital gain at once. And your RRSP or RRIF, unless it rolls to a spouse, gets dumped onto your final return as income, all of it, in one year. A half-million-dollar RRIF taxed like a half-million-dollar salary, top bracket.

So no, Canada doesn’t call it an estate tax. But your estate won’t care what it’s called. For most people watching, between a lifetime of gains and a healthy RRSP, your family hands over far more at death in Canada than they ever would in the U.S.

So who wins this round? The U.S., and it’s not close.

Final Verdict

So what’s better: Canada or the U.S.? Well taking a look at the scorecard, you would think that the U.S would be a no-brainer, winning in 4 out of 5 categories here. 

But it depends on the retiree.

If you’re lower income, Canada likely wins. Healthcare, GIS, and the safety net matter more than chasing lower taxes.

If you’re higher income with U.S. assets, the U.S. can look better financially. Lower taxes, the step-up in basis, and treaty treatment on CPP and OAS can all help.

And there are so many other factors you might be considering that can’t be found on a spreadsheet.

So the real answer is this: Retirement is figuring out which one you need.

At Blueprint Financial, we help cross-border families map all of this out—from residency and departure tax to the bigger financial planning decisions that come with a move abroad.

If you’re worried about the tax side, grab our free guide: The 7 Biggest CRA Tax Traps When Leaving Canada.

You can also explore our financial planning services if you’d like personalized support.

And if this was helpful, consider sharing it with someone who might benefit from it—and keep exploring our resources for the next step in your planning.