Turn what you’ve saved into a paycheque.
Building savings and living off them are two different jobs. This is the second one: when to start your government pensions, which accounts to draw from first, and how to make the money last.
Sound familiar?
- You’re within about ten years of retiring, or already there.
- You have an RRSP that has to become a RRIF by the end of the year you turn 71.
- You want to know your income won’t run out before you do.
Three decisions shape most retirements.
When to start CPP and OAS, the order you draw from your accounts, and whether part of your savings should become an income that an insurer guarantees under an annuity contract. Each one changes how much you keep after tax.
Pension timing
Starting CPP and OAS later means bigger cheques for life. Starting earlier means more cheques. The right age depends on your health, your other income and your spouse.
Withdrawal order
RRIF, TFSA, pension, savings: the order you draw from them changes how much tax you pay, and can affect how much OAS you keep.
Income for life
An annuity turns part of your savings into a guaranteed income, for life or for a set number of years. It won’t suit everyone, but it can cover the bills that never stop.
The rules that set the clock.
Start at 60 and your CPP is 36% smaller, for life.
Wait until 70 and your CPP is 42% bigger, for life.
By December 31 of the year you turn 71, an RRSP has to become a RRIF or an annuity.
OAS can also be delayed to 70, growing 0.6% for each month after 65. Federal program rules for 2026.
Three steps from the Clarity Process.
- 01
Conversation
What you have, what you’ll receive from CPP, OAS and any pension, and what you want retirement to look like.
- 02
Clarity
When each income should start, and what each choice means after tax.
- 03
Confidence
A written drawdown plan: which account, how much, and in what order, year by year.
Questions people ask.
When should I start CPP?
There’s no single right age. Waiting until 70 means 42% more a month for life; starting at 60 means 36% less, but more years of cheques. Your health, your other income and your spouse all matter. My CPP timing tool shows the trade-off.
What happens to my RRSP at 71?
By December 31 of the year you turn 71, it has to become a RRIF or be used to buy an annuity. From the following year, a minimum amount comes out of a RRIF each year, and it’s taxed as income.
What’s an annuity?
You exchange a lump sum for a guaranteed income, for life or for a set number of years. The amount depends on your age, interest rates at the time and the options you choose.
Which account should I draw from first?
It depends on your tax bracket now and later, your OAS, and what you want to leave behind. Often the answer is a mix rather than one account at a time, which is why it’s worth planning year by year.
Can I keep working and collect CPP?
Yes. If you work between 60 and 65 you keep contributing; from 65 to 70 it’s optional. Those contributions add a little more to your pension each year.
CPP and OAS figures are federal program rules for 2026. Annuity income depends on the contract and interest rates at purchase. This is general information, not tax advice.
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