For decades, Canadians have planned to review around 65, with retirement lasting 20–25 years. Today, that picture has changed dramatically. People are living longer, retiring earlier than expected, and facing new financial realities that stretch retirement far beyond what previous generations prepared for.
Here’s what employers and employees need to know about the average retirement age in Canada and why retirement is now lasting longer than ever before.
The average retirement age in Canada.
Officially, the average retirement age in Canada sits around 63–65, depending on the industry.
But real-world data tells a more complex story:
- Surveys show many Canadians expect to retire around 63.
- In reality, many retire earlier, often due to illness, burnout, or caregiving responsibilities.
- In a 2025 financial resilience survey, 44% of retirees stopped working earlier than planned, often at an average age of 59.
That means nearly half of retirees are facing more years in retirement than they budgeted for, sometimes a decade or more.
Why retirement is lasting longer.
Several demographic and social factors are reshaping what retirement looks like in Canada.
While life expectancy currently averages 83 years, the fastest-growing age group in the country is people over 100. Many Canadians now need their savings to last 30–40 years, not 20.
Health issues and family caregiving are two other significant reasons Canadians retire early. Even those who planned to work until 65 often find retirement starting sooner, which means fewer years of saving and more years of spending.
The cost of living is another reason. Recent surveys are saying the same thing. Retirement is more expensive than they planned! Housing, food, healthcare, travel and even hobbies play a part in that.
The traditional “three-legged stool.”
Have you heard of the three-legged stool? It’s the old idea that retirement income would come from three sources: personal savings, employer pensions and government programs. This idea is now under pressure. Fewer Canadians have defined-benefit pensions, and CPP and OAS are not designed to fund a long retirement on their own.
What this means for today’s workforce.
So, what does all this data mean for today’s workforce? A longer retirement, combined with the risk of an earlier exit. This means that employees need to save earlier, save more consistently, and better understand their benefits. They need to plan for the possibility of illness or sudden retirement.
They need to build better financial resilience for both expected and unexpected life events.
This is all great, but many employees don’t know where to start or how to do that.
Here’s where your business comes into play.
How employers support employees.
Employer-sponsored retirement plans and benefits now play a bigger role than ever before. In fact, 57% of Canadians say their workplace influences their financial decisions.
Offering substantial savings and retirement programs is essential. As a company, you must communicate benefits clearly and provide financial literacy and retirement education for employees. You can also help employees prepare for medical or unexpected leave by offering disability coverage and wellness programs.
Retirement isn’t what it used to be.
With Canadians potentially facing a 30-40-year retirement, long-term planning matters more than ever. Employees need support navigating this new reality, and employers have a unique opportunity to help.
At Navy & Sage Benefits, we help businesses design benefits that support financial well-being and give employees the clarity and confidence to plan for the future. Get started today with a call.
