You’ve worked hard your whole life, but when it’s time to collect CPP, you might be in for a shock. Most Canadians don’t get anywhere near the maximum of around $2,000/month, even after decades of contributions.
Today, I’ll break down the 3 biggest factors affecting your payout, and most importantly—show you how to get as close to that $2,034 per month as possible.
Factor #1: Why Earning a High Salary Doesn’t Guarantee Max CPP
If you start CPP at age 60, the average payment is just around $530 / month —a 74% drop from the max of $2,034.
To get the maximum CPP payout, your salary and income must be high enough to meet the maximum contribution level. But what counts as “maximum” has changed over time—and now, with CPP2, there’s a new layer to consider.
CPP2 & Earnings Ceilings
Starting in 2024, CPP introduced a second earnings ceiling, meaning higher-income earners now contribute more:
- In 2025, the new second ceiling (YAMPE) is $81,200, meaning this is what you need to earn per year to receive maximum CPP payments when you retire.
How It’s Changed Over Time
YMPE has steadily increased, making it harder to reach max CPP. For example:
- 1990: $28,900
- 2000: $37,600
- 2010: $47,200
So, what counted as a high enough salary to max out CPP in the past wouldn’t be enough today. And it’ll keep rising, meaning younger Canadians will need even higher salaries to qualify for the maximum benefit.
James’ Story: Earning Max Still Isn’t Enough
Meet James, who has earned at least the YMPE every year for nearly four decades. He’s done everything “right” and decided to start collecting CPP at age 60.
How much will he get?
Not even close to the full $2,034 per month. Instead, he’ll receive around $917 per month—less than half of the maximum payout!
This is where most people get caught off guard. Even if you max out your salary and are a high income earner, you still might not get anywhere near to the max CPP.
And that brings us to the next biggest factor that determines your CPP payout…
Factor #2: Delaying CPP – Why Timing Matters
One of the biggest factors in determining your CPP payout is when you start collecting it. The longer you wait, the higher your monthly payments will be.
Here’s how CPP payments change based on when you start taking them:
| Age You Start CPP | Average Monthly Payout | Maximum Monthly Payout |
| 60 | ~$517* | ~$917* |
| 65 | $808 | $1,433 (source) |
| 70 | ~$1,150* | $2,034* |
(*Estimated based on current trends and deferral increases.)
If you take CPP at age 60, the average monthly payment is just $540, while the maximum possible amount is $917. If you wait until 65, the average jumps to $808, with a max of $1,433.
But delaying all the way to 70? That boosts your payout by 42% compared to taking it at 65. On the flip side, starting CPP at 60 reduces your payments by ~36%—and that reduction lasts for life.
Yet, despite the huge financial benefits of waiting, less than 2% of Canadians actually delay CPP until 70. So if you don’t receive the maximum amount, you’re not alone—the vast majority of Canadians won’t either.
The Trick to Getting More: Patience Pays Off
Taking CPP at 60 is kind of like eating all your Halloween candy in one night. Sure, it’s tempting, but when you realize you could have stretched it out and enjoyed it for longer, you might regret it later!
One important thing to keep in mind: CPP is indexed to inflation, meaning your payments will continue to rise over time to keep up with the cost of living. In recent years, CPP payouts have increased significantly due to higher inflation rates.
Pro Tip: Consider delaying OAS (Old Age Security) alongside CPP—it also increases by 0.6% per month after age 65, which can make a big difference in your retirement income.
Now, I’m not saying everyone should delay CPP—there are many factors to consider, like your life expectancy, financial situation, and income needs. To help guide your decision, check out this blog post here where I’ve broken down the best age to start CPP!
But even if you delay CPP and have a high salary, that still doesn’t guarantee you’ll get the maximum payout…
Why Jerry and Elaine Get Different CPP Amounts at 70
Let’s take Jerry and Elaine, two high earners who both have very high salaries and contributed the maximum to CPP throughout their careers. They each decide to delay CPP until 70, expecting to receive the full $2,034 per month.
But when their payments start, Elaine gets the full amount of $2,034, while Jerry falls short at less than $1,500.
What happened?
That brings us to the third major factor—how long you actually contribute to CPP.
Factor #3: Contribution Gaps – Why Even High Earners Can Fall Short
So far, we’ve covered salary and delaying CPP, but there’s one more critical factor—how long you actually contribute to CPP.
Even if you’ve earned a high salary and delayed CPP to 70, you still might not receive the full $2,034 per month. Why? Because CPP is based on your lifetime contributions, not just your income.
How Contribution Gaps Lower Your CPP
To get the maximum CPP payout, you need to have at least 39 years of maximum contributions. But many people fall short due to gaps in their contribution history. Here are some common reasons:
✅ Career Breaks – Taking time off work for childcare, education, or sabbaticals can result in years with no CPP contributions. While the Child Rearing Provision can help in some cases, many still have gaps.
✅ Self-Employment or Business Ownership – If you were self-employed and paid lower CPP contributions or didn’t contribute consistently, this can lower your lifetime average, even if you had high earnings.
✅ Periods of Unemployment – If you were unemployed for a few years, even if you later had a high salary, those missing years can drag down your average.
✅ Early Retirement or Late Workforce Entry – If you retired before 65 or started working late, you might not have the full 39 years of contributions.
Jerry’s Story: Delaying to 70 But Still Falling Short
Earlier, we saw that Elaine received the full $2,034 per month at age 70 because she had 39 years of maximum contributions with no gaps.
But Jerry, who also delayed CPP to 70, ended up with less than the full amount.
Why? Because he had contribution gaps—maybe he took time off to start a business, went back to school, or was unemployed for a few years. Even though he maxed out his salary in working years, those missing years pulled his average down.
How Contribution Gaps Affect Your Final CPP Payout
CPP uses your best 39 years of contributions to calculate your retirement benefit. However, not everyone works or contributes consistently for that long.
To help with this, CPP includes the General Drop-Out Provision, which allows you to exclude up to 17% of your lowest-earning months from the calculation.
- Since CPP considers 47 years of potential contributions (from age 18 to 65), this means you can drop about 8 years of low or zero contributions.
- If you delay CPP to 70, your total working period extends to 52 years, but the drop-out period remains roughly 8 years.
This provision helps reduce the impact of short gaps in your work history. However, if you miss more than 8 years of contributions, your final payout will be lower, even if you earned a high salary and delayed CPP to 70.
That’s exactly what happened to Jerry—despite delaying CPP and earning a high income, his contribution gaps still lowered his payout.
This means that if you:
✔️ Maxed out salary ✅
✔️ Delayed CPP to 70 ✅
❌ But had years with no contributions ❌
You still won’t get the full amount.
“CPP is like a three-legged stool” – Your payout depends on salary, timing, and consistency. If one leg is weak, the whole thing is unstable.
Before we continue, if you want to save more on taxes in retirement, check out our free guide with 5 proven tax strategies to keep more of your money.
How to Maximize Your CPP Based on These 3 Key Factors
If you want to get the maximum CPP payout, you need to optimize all three factors. Here’s how:
1️⃣ Delay CPP Until 70 (If Possible) – The Biggest Boost
Delaying CPP is the easiest way to increase your payout because it doesn’t require earning more or changing your work history. However, it does require careful financial planning.
✔️ Delaying past 65: Your CPP increases by 8.4% per year, up to a 42% boost at age 70.
✔️ Starting before 65: Your CPP decreases by 7.2% per year, up to a 36% reduction at age 60.
✔️ Its crucial to plan have other income sources (e.g., investments, TFSAs, RRSPs) to cover expenses while waiting.
2️⃣ Earn at Least the YMPE (or Higher) for as Many Years as Possible – The Hardest Step
This is the hardest factor because you can’t just flip a switch to earn more money. But if you can increase your income over time, it directly increases your CPP payout.
✔️ Negotiate higher wages and promotions—the more you earn, the more you contribute.
✔️ Start a side hustle or business—but make sure you pay into CPP if self-employed.
✔️ Level up your skills—invest in certifications, training, or new skills that can help you land a higher-paying job.
✔️ Switch jobs strategically—in many cases, changing employers can result in faster salary growth than staying in the same position for years.
3️⃣ Avoid Contribution Gaps & Maximize Your Contribution Years
Even if you delay CPP and earn a high salary, you won’t get the full amount if you have too many missing years.
✔️ Work for at least 39 years with strong contributions—missing too many years lowers your average.
✔️ CPP allows you to drop up to around 8 years of low/no contributions, but if you miss more than that, your payout will be lower.
✔️ Use the Child-Rearing Provision to exclude low-income years if you took time off to raise children under 7.
Maximizing your CPP is more than just earning more—it’s about making smart financial decisions. With the right strategy, you could add hundreds to your monthly retirement income.
At Blueprint Financial, we offer personalized plans to help you maximize your CPP, minimize taxes, and secure your future. Explore our financial planning services here.
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