Retiring in Canada: a complete guide
The Canadian retirement system is generous compared to the US system. From the low poverty rates among older people to the universal single-payer healthcare system, there are many reasons to consider retiring in Canada.
Of over 38 million existing residents in the diverse, scenic and safe country of Canada, many would agree that retiring to the Great White North is a great idea. But if you’re actively considering this option, research is imperative before you make any firm decisions.
From the Registered Retirement Savings Plan and the healthcare system to understanding all of the costs, complications, and perks of changing locations, let’s explore the potential shape of your retired life in Canada.
What’s the average cost to retire in Canada?
Financial freedom is a huge goal for many of us, especially when it comes to how we want to spend and exist as retirees. To avoid feeling financially overstretched in Canada when your working years are over, you’ll need to know how much retiring there will cost you, including factors like healthcare, housing, general living expenses and, of course, the cost of relocating in the first place.
On average, Canadians estimate they need around CA$ 756,000 to enjoy a comfortable retirement. The exact cost for you will depend on the following factors:
Your desired lifestyle
Your income, assets and savings
Your general state of health
Your dependents/family situation
This average figure would give Canada’s retirees about 70 to 80 percent of their pre-retirement salary for each year in retirement, assuming an average retirement age of 64.5. For later retirees, a smaller pot of savings will be needed. The extra years will need to be accounted for and budgeted out for early retirees.
Which visas do I need to retire in Canada?
Regardless of how old you are, if you’re an American entering Canada, you’ll automatically receive a tourist visa valid for up to 183 days. If you want to stay longer, you must complete additional paperwork and request permission to extend your stay. There’s no official retirement visa in Canada, so most US citizens retiring to the country:
Are dual citizens of the US and Canada
Have a Canadian spouse
Have Canadian children or grandchildren (can apply for the parent and grandparent super visa)
The parent and grandparent super visa allows individuals to live in Canada for up to two years at a time, for a total of ten years.
If you can become a permanent Canadian resident, you’ll have access to government programs, such as universal healthcare. This is a much better option than attempting to enter the country on a tourist visa and retiring from there.
Canada also has an immigration process called Express Entry that might interest those looking for a potential second career in retirement. Express Entry invites certain skilled workers to apply, and successful applications are placed in a pool of candidates who will possibly be invited to apply to immigrate.
Where are the best locations in Canada to retire?
If retiring in Canada is on the cards, you might wonder, “Where would be the best place in Canada for me to live?” This vast country is filled with exciting cities and breathtaking landscapes. Some of the best locations for retirees include:
Calgary, Alberta – recently listed by The Economist as one of the top five most livable cities on the planet, Calgary is a vibrant and culturally exciting place to settle for your retirement. There are several great retirement communities in the city.
Quebec City, Quebec – Quebec City brings European living to Canada. It is located in Canada’s French-speaking province and’s the only remaining fortified city north of Mexico. So, it’s perfect if you speak French or decide to pick it up.
Victoria, British Columbia – Victoria is the biggest and busiest island on America’s west coast. It’s likely a perfect fit for you if you love boating and beaches, and it has one of Canada's mildest, least snowy climates.
What are my healthcare options in Canada?
Canada’s single-payer healthcare system is available to all citizens and permanent residents. It’s largely covered by taxes, with some residents and citizens paying monthly or yearly premiums on top of these taxes to increase their level of coverage.
If you are either a citizen or a permanent resident, you’ll largely find your medical fees are paid, but you may still need to cover things like:
Glasses and contact lenses
Non-emergency dental work and care
You’ll also be able to access free care if you’re not a resident or a citizen. Canada’s emergency services are available to anyone in the country (though some walk-in clinics may charge a fee).
Understanding the housing market in Canada
The cost of housing in Canada, much like in the USA, differs greatly depending on the location where you choose to settle for your retirement. To give you a general idea, the average home selling price on the Canadian Real Estate Association’s MLS system, as of April 2023, was CA$ 716,000.
To look at things by area:
|Area||CREA’s average MLS price, as of April 2023|
What happens to my retirement benefits if I retire in Canada?
If you have US retirement accounts, such as an IRA or a 401(k), you’ll want to know what will happen to these accounts and their associated benefits if you decide to move to Canada. There are broadly four options:
Leave your account open in the US and ask someone to manage it for you
Cash-out the plan and pay the necessary tax, if applicable
Start your retirement distribution (if you’re at the right age)
Transfer your account to a Canadian Registered Retirement Savings Plan (RRSP)
Some many specific rules and stipulations will apply depending on your retirement plan and the nature of your residency in Canada. A qualified finance professional can offer expert advice in navigating this switchover of assets.
In some cases, you might find you’re eligible for the Canada Pension Plan (CPP) or Old Age Security (OAS). Plus, thanks to the US’s Totalization Agreement with Canada, US citizens living in Canada can still receive their Social Security benefits.
If you’re open to moving to a new country for retirement, options are aplenty, from Mexico to Thailand. But Canada might well give you all you need, providing you with a similar climate and culture to the US, letting you retain access to your retirement benefits and bringing new perks like subsidized healthcare to the table.
It’s always worth consulting a financial expert when making significant life decisions like moving abroad – so why not speak to a financial advisor and get their take? A financial advisor can help you plan and realize your dream retirement.
Senior Content Writer
Rachel is a Senior Content Writer at Unbiased. She has nearly a decade of experience writing and producing content across a range of different sectors.