MoneyGal said:
The average Joe would have to work until age 57 or 53 *making full contributions for each year* in order to receive the maximum benefit at 65 / the maximum reduced benefit.
Yes, good point ... I was actually referring to a person’s individual maximum, as opposed to
“the” maximum ... however, I never made that point clear ... thanks for clarifying.
That's the "contributory period" for CPP contributions: ages 18-70
Not quite ... the contributory period runs from age 18 until (a) you die; (b) you begin receiving CPP payments, or (c) you turn 70 ... whichever occurs first.
Note that the recent changes to CPP distort that definition a little, in that you MUST in some circumstances, and MAY in other circumstances, continue contributing to CPP even after you’ve begun receiving it ... in such cases, the overall benefit amount will be the result of some blend of varying contributory periods.
you can drop out up to 15% of the lowest-earning years
For the moment, but its 17% for anyone who initiates CPP in 2014 or later ... I assume that includes most people participating in this forum ... anyone presently aged 56 or less should just assume 17%, and ignore the present rule.
Also, to clarify, it is not the lowest earning years that are dropped ... it is the lowest earning
months ... if you had a well-paid summer job during college, that year might represent 8 months of zero earnings and four months of decent earnings, so that can alter the landscape a bit ... likewise for years in which you were employed for only part of the year.
you can drop out an additional (I think) 7 years for child-rearing
I am not certain, but I thought it was ANY low income periods during which you were raising a child under 7 years of age ... that could stretch to more than 7 years when there is more than one child ... I wasn’t aware of a particular cap on that, although I confess it’s a purely academic point in my case ... I also wasn’t aware of the requirement to have collected CCTB.
There's also the capacity to drop out years if you were/are disabled.
Provided you were receiving a CPP disability benefit.
generally speaking if you want full CPP you need to contribute the maximum from ages 18 to at least 65.
NO ... absolutely not ... the basic 17% exclusion covers 8 years if you elect to begin taking CPP at age 65 ... you therefore only need 39 years (468 months, actually) of earnings at or above the YMPE, to get the max ... it makes no difference whatsoever what you did in the other 8 years (96 months).
PS ... contrary to popular belief, the amount you contribute to CPP has no direct bearing on the calculation of your CPP benefit ... the relevant metric is your pensionable earnings.
You can only get GIS if you have little or no other income other than OAS.
YES ... a little off-topic in this thread, but this is why it is so laughably absurd that the GIS is constantly tossed up in discussions of RRSP ... I read somewhere (can’t find a cite) that the majority of GIS recipients are elderly widows who spent most if not all of their lives out of the workforce, and whose deceased husband’s pension (if there was one) had poor, if any, survivor benefits ... that is a declining demographic, and one would have to be off their rocker to actively plan to be in that situation in retirement ... therefore, anyone who plans ahead, and especially anyone who plans decades ahead, for retirement, should simply ignore the GIS ... it will be a non-issue.