You need to save for retirement...

The maximum Canadian Pension Plan and Old Age Security payments for a single person is currently approximately $14,500 or about $1,200 per month in 2001. It is clear that government programs alone are not sufficient for your retirement. To supplement them, tax incentives exist to encourage Canadians to save for their retirement.

Consider the following government plans to see how thoroughly you will need to supplement your retirement income with other programs.

CPP and QPP provide retirement income to all Canadian who qualify. CPP and QPP contribution levels and benefit formulas are the same, and benefits can be transferred between them. (Some ancillary benefits differ).

Employees and employers contribute equally to CPP and QPP up to the YMPE (Years Maximum Pensionable Earnings. See Glossary for additional information). The total contributions will be 8.6% for 2001, 9.4% for 2002 and 9.9% for 2003 and subsequent years. Upon retirement, CPP and QPP benefits are adjusted every January 1 by a formula related to the Consumer Price Index.

OAS payments begin at age 65 for those who meet residency qualifications. OAS payments are generally the same for most residents and are increased quarterly in line with the Consumer Price Index. Since July 1, 2000, OAS payments have been increased slowly when taxpayers' income exceeds a certain level.

GIS is available to any Old Age Security recipient who meets criteria for low income.

For complete details on all Government sponsored benefit programs, please visit the Human Resources and Development Canada website at http://www.hrsdc.gc.ca/