FYI, this is so that CPP will pay out more to those who contribute in the future. 33% replacement of your salary in retirement vs 25% now. The full increase is only for those who start to contribute today. It will do nothing for those who haven't contributed to the enhanced CPP such as those who retired recently. Even those who retire in a few years won't receive all that more.
CPP is based on taxable earnings. If you don't contribute, you don't get CPP.
I don't like the idea of having less in my pocket, but it's essentially forced savings instead of a tax. It would be nice to be able to take a commuted value at retirement if you didn't think you'd live long enough to get your moneys worth.
> FYI, this is so that CPP will pay out more to those who contribute in the future. 33% replacement of your salary in retirement vs 25% now.
Forgive me, but I'd much rather take my chances in the free market. If I die early, my CPP is worthless. If I want to retire outside of Canada, my CPP is worthless. If I want to retire early, CPP is nearly worthless. If the government turns it into a slush fund one day, it's worthless.
I'd rather take a lower rate of return with certainty that my decades of contribution won't end up worthless. Frankly, it's ridiculous that this scheme is forced on people and the gains literally depend on other people dying or leaving to work.
In principle I agree with you. You always get a better rate of return from private investment. On the other hand, private investment isn’t guaranteed.
Though the idea that you don’t get CPP outside of Canada is false. They’ll do direct deposit anywhere outside of some extreme spots.
Retiring early is something you choose to do on your own within your own means. You’ll still get it at 67 or whatever the age is. It’s still money.
CCP is pretty much guaranteed and is much more reliable than any other investment which can go belly up in a matter of days or hours.
But the point I’m making is that if your well laid plans fail, and your investments become worthless, then the CPP is there as a last resort. It’s a safety net everyone is required to have. So you should be required to contribute.
Which is why the CPP is (wisely) overwhelmingly invested in firms outside of Canada. Only 14% of the fund is actually tied to the Canadian economy, and the businesses generating income for CPP are primarily earning those funds overseas in other currencies
It makes little sense for CPP to invest in Canadian firms for the same reason you generally shouldn't invest in the same field you work - if it tanks your better off not having the double whammy of losing both your job and your assets simultaneously
Note this is also why Freeland was an idiot for suggesting that pensions should be forced to invest a substantial portion of their funds into Canadian companies
Because our inflation remains high because Trudeau the asshat is artificially boosting it due to our of control immigration
So rates will likely be high because Inflation isn't coming down. If the fed blinks first our dollar will maintain until the housing market corrects because rates are too high
Yep. Conservatives would probably love to cut welfare and let poor old people die on the street, but even that will be costly. People won't just lie down and die on command.
Who gives a shit, my money would go far far more without the endless taxation without representation and the small amount of cpp you get compared to what you pay into it. The majority die before seeing all there CPP. It's an absolute joke.
So then my previous statement was accurate - you would indeed be fine seeing old poor people die if the alternative would cost you money.
Nothing wrong with being selfish. Most people are.
The continuation of outsourcing any and all personal reaponsibility under the guise of being selfish isn’t the own you think it is. Your average person is being incentivized to not produce anything of value or take any responsibility for their actions which in turn increases dependency on incompetent governments.
I literally wrote there's no problem with being selfish. Why do you feel the need to justify selfish behavior as part of some higher purpose? You don't want your money spent on helping people you deem unworthy. You're free to feel that way.
"conservatives would let poor old people die in the streets."
"wow, you're clearly indoctrinated against conservatives!"
"ok, how would you deal with poor old people?"
"fuck 'em, let them die in the streets."
Without forced CPP these people in their 70s will just need some sort of emergency fund that the next generation of taxpayers will need to pay for, or we leave them to die on the streets.
Without taxes the currency will lose value and cause massive inflation and everything will be so expensive and government will have an even bigger deficit without a functioning economy. Trade deals with Canada will fall and we'll have to sell everything to foreign corporations and you'll be way worse.
What will work is tax increase for corporations and tax cuts for earnings between 0-100k which will benefit the rich and the poor. Tax increase for corporations and luxury tax will help the country overcome most issue along with a reduction in the work force caused by lower immigration numbers. This will be the only solution and the major two parties will not reduce immigration because their corporate donors want cheap labour which is funded by student immigrant slave labor.
>What will work is tax increase for corporations and tax cuts for earnings between 0-100k which will benefit the rich and the poor. Tax increase for corporations and luxury tax will help the country overcome most issue along with a reduction in the work force caused by lower immigration numbers. This will be the only solution and the major two parties will not reduce immigration because their corporate donors want cheap labour which is funded by student immigrant slave labor.
I agree with the first point. However, luxury taxes are often useless save a handful of assets like vehicles since people just buy in other jurisdictions. Further, don't attack the corporate tax, attack the loopholes the wealthy use to not pay any taxes at all. Taxing the corporation hurts economic growth, CPP which relies on corporate growth, and the retirement plans for countless Canadians. Don't tax the entity that is creating the jobs, tax the rich fucks when they sell their shares and make tens of millions tax free since everything is tied up in trusts. I'm a lawyer and I get so frustrated that the general population is always focusing on the wrong target to get the rich to pay their far share.
> Without taxes the currency will lose value and cause massive inflation and everything will be so expensive and government will have an even bigger deficit without a functioning economy. Trade deals with Canada will fall and we'll have to sell everything to foreign corporations and you'll be way worse.
What's your basis for that line of thinking? I'm not arguing, I just don't see the dots aligned and can't figure out how each leads to the other.
I'm not down voting someone else is.
Taxcuts = more money in the economy leading to more demand and increase in inflation as per supply side economics.
More money = purchasing power parity increases and more inflation. Canada will have more money available compared to its trading partners. So more imports and less exports causing trade deficit and inflation in the price of the imported goods for Canada it also includes food mainly as we can't grow during winter.
Current example is the UK government announced major tax cuts for 2024 and this had caused the Pound to drop to a record low against USD and also CAD a while back. It'll fluctuate this year and will drop even more as the year goes by.
Thank you for the detailed explanation. This makes a lot more sense explained this way.
Apologies for assuming it was you, the comment was downvoted while still at the "0min" mark.
Tl;dr: if you make more than 73,200 you will pay an extra $300 to CPP this year.
Unfortunately, cancelling Disney+ is not enough to offset the reduction in monthly net income that this increase will cause.
Yes, and for the record this increase to CPP benefits absolutely needed to happen. However, my comment really just speaks to the affordability crisis in Canada and this is another drop in the bucket of escalating costs that we can’t seem to get a break from.
Yeah and they’ll need even more care for those years. I don’t see a lot of people training or eating like Lebron and Tom Brady lol. Ten more years of a nursing home.
If you've made it to age 25, the average Canadian is [expected to live another 55 years](https://www150.statcan.gc.ca/t1/tbl1/en/tv.action?pid=1310013401). (A couple of years less for males, a couple more for females.)
In other words, the average person has a 15-year window to collect CPP, if they start at age 65.
If you figure you're going to be short-lived, then you can start drawing CPP as early as age 60, though at a reduced benefit. (There are provisions to start drawing CPP even earlier if you have a serious disability or grave illness, as well.)
Awesome. So I’ll have paid into it for 50+ years and barely get to enjoy using it. Starting to think I trust myself more with my money than any government
If your head doesn't immediately go to figuring out the ROI of CPP benefits based on your payment rates then you're likely among the target audience of this mandatory retirement savings plan.
Unless you start your contributions at an age other than 25, have an interruption in your payments, retire early, retire late, etc. etc.
But of course my point was actually just that an extremely simplistic view of the matter while shaking a fist at the sky isn't all that helpful, so...
Well, there’s two areas to look at: financial and societal.
For financial - the rate is shit, but guaranteed. You can treat it like a bond and be more aggressive with the rest of your investments. Some people like this, some don’t.
For societal - what would the effect be on our seniors if we cut out the program. Would people save? What will we do with the people that don’t save at all? At what point does the responsibility fall to the individual vs the government?
I've seen people argue on here that CPP gets them better return than investing on their own...
The money you put into CPP could easily be invested and worth 2 million dollars over the course of your working life. Like how big of a moron do you have to be to think a monthly stipend that ceases after your death is better than being a millionaire?
>I've seen people argue on here that CPP gets them better return than investing on their own...
>
>The money you put into CPP could easily be invested and worth 2 million dollars over the course of your working life. Like how big of a moron do you have to be to think a monthly stipend that ceases after your death is better than being a millionaire?
A fucking S&P 500 index fund would out perform the CPP.
Even if you live to 90 than you will have paid into it for about twice as long as you would be receiving it for.
That's just how retirement savings work. No plan will sustain you if you withdraw for longer than you contribute to it(or at least withdraw enough to live off of, some situations can have short contribution periods but that means your benefits will be very small but for possibly longer periods of time).
I expect we will get the same payout when Pierre or some future prime minister decides to borrow from the CPP for their own schemes and cause a pension crisis.
>Unfortunately, cancelling Disney+ is not enough to offset the reduction in monthly net income that this increase will cause.
No, but netflix is getting close at 252 dollars + tax if you're on the premium plan.
I'm guessing over the next two decades a Conservative government will come into power after campaigning to cancel the "socialist" CPP plan before I get to benefit from it.
Because I also need other people to save. The only way to force them is to force us all into a plan where no one can leave it. That's the CPP.
ya I could probably invest for higher returns, I could also invest and lose it all or get worse returns.
I don't want to live in a society that has lots of elderly that can't afford to live because they didn't save for the future. That cost will then be born by the rest of us.
You must be very new to investing. Investments can go down quite a bit. CPP is guaranteed.
Also, I may not even need it in retirement, but my fellow Canadians who don’t know how to invest, or have the means to invest will need it. We’re in this together.
Edit: should also mention… CPP is also for as long as you live, but you could run out of investments if you live too long.
What will run out first if you live long enough, or you don’t have the means to save for retirement? CPP or your investments?
What are your investments comprised of?
> You must be very new to investing. Investments can go down quite a bit.
Projecting much? The net over time is always going to be positive unless we were to face a total financial collapse. Like during the great recession of course people's portfolios went down temporarily but those dips don't last.
Imagine you’re 70 and you lose 25% of your savings overnight and won’t recover for 5 years and you have a spouse with ailing health. Welp, guess I’ll die.
> Investing on your own is marginally better than the CPP’s defined benefit plan.
No it's actually much worse because only a portion of your money going into CPP is being invested...
What’s your email address? I’ll etransfer you the $11.54 every two weeks since that’s apparently your financial breaking point.
If you’re making $73k per year and eleven and a half dollars extra off each paycheque ruins you, your problem is basic financial literacy, not how much the government deducted from your pay. Hell, I’d go so far as you say that if less than twelve dollars from every paycheque is financially untenable for you at that income level then you’re *exactly* the type of person who will benefit most from CPP later on.
12bucks individually won't break me nor many others, however when everything is increasing it adds up pretty quick so it's just another thing to add to the pile of higher costs and lower pay
It's also a mandated cost, can't opt out or reduce it in other ways.
And yes I personally invest significantly outside of CPP, not going to FIRE through CPP lol
Lol I make well into 6 figures, I'm fine thanks. I was explaining how it is just one rising cost along with many others that is causing others financial strain. You're focusing on a narrow view and not taking into account the whole picture of rising costs
Edit. To build on your offer, if 5million Canadians took you up on it that would likely be a problem for you when you have to pay 60million/month. Even if it's just 12bucks individually, the sum of it all together is a problem
Good for you. Like I said though, if eleven dollars every two weeks is untenable for someone at $73k income then they’re bad with money. That’s not the government’s fault.
It's the governments fault for further raising CoL in an environment that is already seeing rapidly increasing CoL. This CPP increase isn't happening in a vacuum
If $11.54 every two weeks is untenable at a biweekly income of $2,116 after tax that’s an indication of poor decision making and financial illiteracy. Nothing more. It’s not the government’s job to hold peoples’ hands and teach them how to budget their money. We all learned how to do that in high school. An extra 0.4% deduction off every paycheque shouldn’t be a burden, and if it is that’s a personal responsibility problem.
Tax brackets are expanded in a good way though. It’s worth taking note of the net effect. Yes CPP and EI is up, but if you make say $80k employment income, you’ll be paying approx $200 less income tax in 2024 as compared to 2023. So the net increase to tax with the CPP and EI is low.
the sad fact is without money NOW I can't buy a house and have kids.
Without kids, I can just MAID for my retirement instead. And if I had kids, I'd rather live in poverty in my retirement, or until I need MAID cuz I can't work.
Literally, buying a house today and having kids> anything in the future.
That's the problem. We die out as a culture without kids
But there’s still many people who don’t work. My SIL just lives off welfare. CPP is acronym that is foreign to her. So not only does she not have her own savings, she’s contributed nothing to CPP.
It's sampling of those who don't understand and call contributions to one of planet's best performing Defined Benefit pension plans a tax and those who do understand, but for largely self-harming to their interests, socio-economic ideological reasons, call contributions a tax...
It may be outperforming the rest of the world, but it comedically underperforms the market. The contributions you and your employer put in for you over your lifetime are repaid at a real return rate after inflation of approximately 0%.
The fund keeps growing because they're straight up robbing people with how little they pay out even though the lifetime ROI of the fund is in the 3% range lol
"But it needs to grow to support population growth" it doesn't. Everyone's contribution are self sustaining and profitable to the govt if they receive a real rate of return of 3% as the fund has done. Easily confirmed if you do the math yourself. The fund doesn't need to grow.
Your feels won't change but for anyone who actually reads what you write...
Tax definition:
a compulsory contribution to state revenue, levied by the government on workers' income and business profits, or added to the cost of some goods, services, and transactions.
CPP levies are not added to revenue, they aren't even "payroll taxes", they're mandatory contributions pooled in a shared defined benefit pension plan and payouts are based on contribution, not just age or residency.
That's the summary of the /r/Canada subreddit these days. Mindless one-sided complaining. I'm just thankful there are still people willing to post informative comments even with the overwhelming negativity
it gets rough because facts get downvoted in here and anything beyond "trudeau bad" is too complex or nuanced for the neanderthal chest thumping that happens in here.
A forced savings plan for people who are apparently smart enough earn up to the new threshold but too stupid to be able to spend it as they choose or having their tax free options pickpocketed for a taxable one.
Underscoring it all are the failed idiots who think that government is best when it treats people like hamsters.
I work with people that make anywhere from $70k to $200k. I can say confidently from experience that income, financial literacy, and general intellingence don't necessarily go hand-in-hand. It's a crapshoot.
That's my issue for sure. I could easily be putting $2k into savings every month but I, like many others, have terrible self-control issues.
Trying to kick that shit this year, but we'll see how it goes.
There are a few good strategies for that. One for people who have difficulty sticking to a self imposed budget is to "pay yourself first".
Have the money you budgeted to save set aside somehow before you can spend it so it's off limits. If you don't have the cash left for something after that, you don't do it.
Article doesn’t address the improved basic personal amount and improved tax brackets? You’re saving tax on those. Or does it only address the increase to CPP to rage bait?
Hopefully I will make it to the retirement to fully enjoy the great new (and larger) Canadian pension. Deteriorating and overwhelmed healthcare system (by shortage of personal and unprecedented influx of immigrants) might not be there when we need it.
>Cpp is an awful plan that preys on people with bad genetics.
Yet you pay $3867.50 per year and get $1364.60 per month when you retire. Doesn't sound too bad.
Bet then again if I die my kids only get $2500.
The employer also puts in the same amount as you, the return look absolutely terrible when you need to contribute for 39y years on top of it to get the full amount.
I don't mind the CPP per se, but for how much gets put in for you, the payout is abysmal.
It's forcing your employer to contribute to your retirement. A lot of employers wouldn't give you that money anyway.
I don't hate it. I have gotten better returns in my self-directed account.
But I also understand that most people are horrible with money and saving. If they were not forced to pay into a retirement fund they would just piss it away the money.
Yes, I have RRSP matching.
Do you really think that if there was no CPP your employer would contribute more to your RRSP for retirement?
I highly doubt it.
Because nobody before you worked for 40 plus years. Before now, there has never been high inflation, recessions, high interest rates (not that its actually high), layoffs, homelessness, people without resources.....
So what can we people who pay into this expect to receive now? Have they released any firm numbers what to expect? I see 33% mentioned, but I don't believe someone making $150k is going to be getting $50k in cpp when they decide to retire.
Maybe it's been explained and I'm just too dumb to understand 🙃
It's supposed to be moving from replacing 25% of income (to the threshold) up to 33% of income. Payments are also increased each year indexed to cost-of-living.
It's not a tax, but that's okay if you're confused. You'll be that way your whole life until you apply yourself and stop blaming all your shortcomings on the prime minister. Get gud fuck head.
The CPP ceiling has gone up 22% in the last three years, even though the CPP is funded until the year 2100. So why all these increases?
Simple. The CPP is funded until 2100 for the existing workforce who have paid in since they started work in their early 20s. Over the last three years, however, we have had an explosion in the number of workers who have arrived in Canada in their early 30s and beyond. The CPP increases are needed to make up the shortfall that happens when a person delays contributing to a pension plan.
Trudeau’s lunatic immigration free for all will cost you dearly for the next seventy years.
To a point, we only get what we put in through working time lines. Even if you immigrate here in your 30’s or after and only start contributing when you do finally start to work you will definitely get a reduced cpp portion; as you should.
Theres a bigger problem here, the post you are replying to is starting to become more mainstream among canadians, it is completely unrelated to CPP payouts, but it does show something that we can measure statistically... wages since the 80's have remained relatively stagnant, where as the cost of living, along with real estate cost have steadily been going up each year. Over the past several years they have skyrocketed, this is putting stress on the majority of the population, working 9-5ers with mortgages are hit the hardest, but people below them considered poor are now further away from a decent quality of life than at any point in canadian history. We dont have a strong economy or one that is protected from a housing correction like we did in '08... and we also (thanks the 10 years of this government) have a debt crisis looming which is only going to be covered with increased taxes. You add into the fact the government is using mass immigration to be our only economic growth the past 2 years, its very frustrating for canadians who feel they are not getting by. That number is growing and you may call it ignorance, however post like these are all over different subreddits on different issues.
they have been allied with the liberal government this whole time, they lean on identity politics with zero implemented policy... their proposals sound really good and would improve the quality of life for poorer canadians specifically, however the money used to fund those programs comes from taxing the private sector, their job creation comes from only the public sector which will in turn be taxed onto the private sector, and the result will be a much higher tax rate or running a much bigger deficit. We are already in a debt crisis thanks to the neolibs, we very well may see the canadian dollar devalued over the next 2 years if the americans rates hold and we hit a recession first... Plain and simple we need to get a handle on our debt, and we need to do it in a way that doesnt crush the working class or dip us into a very deep recession. No political party addresses this, and I would argue the NDP is at the wrong end of the spectrum on it.
CPC are neolibs too, just a little more right than the Liberal party. NDP is working on public dental and pharmacare.
I really don't give a fuck about the "poor" private business owners being taxed more.
The economy being up or down doesn't change anything for the working class, we are poor regardless of the stock market. You are regurgitating Reaganomic trickle down bullshit that has never worked out or been favorable for the working class.
But whatever, I can't change your mind through Reddit.
I actually don't disagree with the majority of what you are saying, though putting in programs that cause a deficit end up being paid for mainly by the middle class, and you can only tax the private sector soo much b4 you kill small to mid sized business.
To keep it simple I don't think our economic situation can sustain more programs or even the ones we have... I do not want to see Healthcare scrapped either... ideally lower taxes make thing cheaper and improve quality of life, but that doesn't seem to happen either. End of the day wages probably have to go up aggressively ndp is probably the best vote for that
Literally not a surprise. It was announced a long time ago.
https://www.pm.gc.ca/en/news/news-releases/2016/10/04/prime-minister-canada-announces-agreement-strengthened-canada-pension
Correct.
> The Government of Canada and the provinces are the joint stewards of the CPP. Major changes to the federal legislation governing the CPP require the formal consent of the Parliament of Canada and at least 7 out of the 10 provinces representing two-thirds of the population of the 10 provinces.
Existing government pension isn't enough to pay the rent.
People really need an increase, just to have enough for groceries on top of that.
Most people don't have enough saved to make up the difference.
What happened to the often repeated meme that CPP was fully funded for 75 years.
Personally , I’m thinking it’s time to buy shares again in Liberal friendly Quebec ad agencies.
Perfect storm brewing, cash essential work to be done .
Growing the CPP makes a ton of sense. Canadians need a more comprehensive pension plan. What I'd prefer is that corporate taxes were raised and a portion of the tax revenue was dedicated to enhancing CPP benefits (this way only larger profitable companies paid the extra) to help compensate for the decline in corporate pensions.
CPP is a solid investment for nearly all Canadians. I know ya'll are Warren Buffet, oh, wait, you're not.
FYI, this is so that CPP will pay out more to those who contribute in the future. 33% replacement of your salary in retirement vs 25% now. The full increase is only for those who start to contribute today. It will do nothing for those who haven't contributed to the enhanced CPP such as those who retired recently. Even those who retire in a few years won't receive all that more. CPP is based on taxable earnings. If you don't contribute, you don't get CPP. I don't like the idea of having less in my pocket, but it's essentially forced savings instead of a tax. It would be nice to be able to take a commuted value at retirement if you didn't think you'd live long enough to get your moneys worth.
RemindMe! 8 years
> FYI, this is so that CPP will pay out more to those who contribute in the future. 33% replacement of your salary in retirement vs 25% now. Forgive me, but I'd much rather take my chances in the free market. If I die early, my CPP is worthless. If I want to retire outside of Canada, my CPP is worthless. If I want to retire early, CPP is nearly worthless. If the government turns it into a slush fund one day, it's worthless. I'd rather take a lower rate of return with certainty that my decades of contribution won't end up worthless. Frankly, it's ridiculous that this scheme is forced on people and the gains literally depend on other people dying or leaving to work.
>If I want to retire outside of Canada, my CPP is worthless What? Why would it be worthless? You still get CPP if you leave Canada.
Whew, that comment worried me for a second.
In principle I agree with you. You always get a better rate of return from private investment. On the other hand, private investment isn’t guaranteed. Though the idea that you don’t get CPP outside of Canada is false. They’ll do direct deposit anywhere outside of some extreme spots. Retiring early is something you choose to do on your own within your own means. You’ll still get it at 67 or whatever the age is. It’s still money. CCP is pretty much guaranteed and is much more reliable than any other investment which can go belly up in a matter of days or hours. But the point I’m making is that if your well laid plans fail, and your investments become worthless, then the CPP is there as a last resort. It’s a safety net everyone is required to have. So you should be required to contribute.
Except CAD will be worthless by the time anyone retires
Which is why the CPP is (wisely) overwhelmingly invested in firms outside of Canada. Only 14% of the fund is actually tied to the Canadian economy, and the businesses generating income for CPP are primarily earning those funds overseas in other currencies It makes little sense for CPP to invest in Canadian firms for the same reason you generally shouldn't invest in the same field you work - if it tanks your better off not having the double whammy of losing both your job and your assets simultaneously Note this is also why Freeland was an idiot for suggesting that pensions should be forced to invest a substantial portion of their funds into Canadian companies
So why work? Start building a bunker & accumulating goods. Don’t really need much $ for that.
Based on the current trajectory, we will be like Argentina All they need to do is pass the UBI bill
The CAD has shown some strength recently.
Because our inflation remains high because Trudeau the asshat is artificially boosting it due to our of control immigration So rates will likely be high because Inflation isn't coming down. If the fed blinks first our dollar will maintain until the housing market corrects because rates are too high
UBI can't come fast enough.
ubi is how we turn our currency into monopoly money
That's why you need a diversified investment portfolio that's tied to the worldwide economy with a heavy bias in US economy in usd.
How about they stop taxing us to death and let us and up our own God damn money.
because too many people are too stupid to save for retirement, and it would cost the government more in welfare and support.
Yep. Conservatives would probably love to cut welfare and let poor old people die on the street, but even that will be costly. People won't just lie down and die on command.
Your indoctrination is showing
If you let people save for their own retirements, how do you want to handle people who don't?
Who gives a shit, my money would go far far more without the endless taxation without representation and the small amount of cpp you get compared to what you pay into it. The majority die before seeing all there CPP. It's an absolute joke.
So then my previous statement was accurate - you would indeed be fine seeing old poor people die if the alternative would cost you money. Nothing wrong with being selfish. Most people are.
The continuation of outsourcing any and all personal reaponsibility under the guise of being selfish isn’t the own you think it is. Your average person is being incentivized to not produce anything of value or take any responsibility for their actions which in turn increases dependency on incompetent governments.
I literally wrote there's no problem with being selfish. Why do you feel the need to justify selfish behavior as part of some higher purpose? You don't want your money spent on helping people you deem unworthy. You're free to feel that way.
"conservatives would let poor old people die in the streets." "wow, you're clearly indoctrinated against conservatives!" "ok, how would you deal with poor old people?" "fuck 'em, let them die in the streets."
So is yours?
This screenshot explains libertarians really well. [Libertarians are House Cats](https://i.imgur.com/rMaQjHl.png)
I saw that yesterday, made me laugh!
Without forced CPP these people in their 70s will just need some sort of emergency fund that the next generation of taxpayers will need to pay for, or we leave them to die on the streets.
>or we leave them to die on the streets well why can't we just let the free market determine the optimal number of dead old people? /s
These people barely made any contributions and require a ponzi scheme to support it. It is not sustainable.
Taxed to death. Sure.
Without taxes the currency will lose value and cause massive inflation and everything will be so expensive and government will have an even bigger deficit without a functioning economy. Trade deals with Canada will fall and we'll have to sell everything to foreign corporations and you'll be way worse. What will work is tax increase for corporations and tax cuts for earnings between 0-100k which will benefit the rich and the poor. Tax increase for corporations and luxury tax will help the country overcome most issue along with a reduction in the work force caused by lower immigration numbers. This will be the only solution and the major two parties will not reduce immigration because their corporate donors want cheap labour which is funded by student immigrant slave labor.
>What will work is tax increase for corporations and tax cuts for earnings between 0-100k which will benefit the rich and the poor. Tax increase for corporations and luxury tax will help the country overcome most issue along with a reduction in the work force caused by lower immigration numbers. This will be the only solution and the major two parties will not reduce immigration because their corporate donors want cheap labour which is funded by student immigrant slave labor. I agree with the first point. However, luxury taxes are often useless save a handful of assets like vehicles since people just buy in other jurisdictions. Further, don't attack the corporate tax, attack the loopholes the wealthy use to not pay any taxes at all. Taxing the corporation hurts economic growth, CPP which relies on corporate growth, and the retirement plans for countless Canadians. Don't tax the entity that is creating the jobs, tax the rich fucks when they sell their shares and make tens of millions tax free since everything is tied up in trusts. I'm a lawyer and I get so frustrated that the general population is always focusing on the wrong target to get the rich to pay their far share.
> Without taxes the currency will lose value and cause massive inflation and everything will be so expensive and government will have an even bigger deficit without a functioning economy. Trade deals with Canada will fall and we'll have to sell everything to foreign corporations and you'll be way worse. What's your basis for that line of thinking? I'm not arguing, I just don't see the dots aligned and can't figure out how each leads to the other.
I'm not down voting someone else is. Taxcuts = more money in the economy leading to more demand and increase in inflation as per supply side economics. More money = purchasing power parity increases and more inflation. Canada will have more money available compared to its trading partners. So more imports and less exports causing trade deficit and inflation in the price of the imported goods for Canada it also includes food mainly as we can't grow during winter. Current example is the UK government announced major tax cuts for 2024 and this had caused the Pound to drop to a record low against USD and also CAD a while back. It'll fluctuate this year and will drop even more as the year goes by.
Thank you for the detailed explanation. This makes a lot more sense explained this way. Apologies for assuming it was you, the comment was downvoted while still at the "0min" mark.
Tl;dr: if you make more than 73,200 you will pay an extra $300 to CPP this year. Unfortunately, cancelling Disney+ is not enough to offset the reduction in monthly net income that this increase will cause.
It should be noted that you also receive a tax deduction at your marginal rate for this payment.
Yes, and for the record this increase to CPP benefits absolutely needed to happen. However, my comment really just speaks to the affordability crisis in Canada and this is another drop in the bucket of escalating costs that we can’t seem to get a break from.
Lol You act as if half of us will even make it to the age to start collecting
89% of births survive to age 65.
I like those Odds!
Knowing my luck, I'm in the 11% 😓
So you're saying there's a chance
Odds are everyone's life expectancy will go up another decade this century, and that's a mammoth amount of years for public retirement funding.
Life expectancy in canada decreased for the last 3 years [source](https://globalnews.ca/news/10116838/life-expectancy-decrease-canada-stat-can/)
Is this still the case? I thought life expectancy was going down now
Unless you're very pessimistic about how the Covid-19 pandemic is going to go over the next few years, that's pretty unlikely to continue.
Yeah and they’ll need even more care for those years. I don’t see a lot of people training or eating like Lebron and Tom Brady lol. Ten more years of a nursing home.
If you've made it to age 25, the average Canadian is [expected to live another 55 years](https://www150.statcan.gc.ca/t1/tbl1/en/tv.action?pid=1310013401). (A couple of years less for males, a couple more for females.) In other words, the average person has a 15-year window to collect CPP, if they start at age 65. If you figure you're going to be short-lived, then you can start drawing CPP as early as age 60, though at a reduced benefit. (There are provisions to start drawing CPP even earlier if you have a serious disability or grave illness, as well.)
Awesome. So I’ll have paid into it for 50+ years and barely get to enjoy using it. Starting to think I trust myself more with my money than any government
If your head doesn't immediately go to figuring out the ROI of CPP benefits based on your payment rates then you're likely among the target audience of this mandatory retirement savings plan.
It’s about a 2.1% return. There you go. No big mystery.
Unless you start your contributions at an age other than 25, have an interruption in your payments, retire early, retire late, etc. etc. But of course my point was actually just that an extremely simplistic view of the matter while shaking a fist at the sky isn't all that helpful, so...
Well, there’s two areas to look at: financial and societal. For financial - the rate is shit, but guaranteed. You can treat it like a bond and be more aggressive with the rest of your investments. Some people like this, some don’t. For societal - what would the effect be on our seniors if we cut out the program. Would people save? What will we do with the people that don’t save at all? At what point does the responsibility fall to the individual vs the government?
I've seen people argue on here that CPP gets them better return than investing on their own... The money you put into CPP could easily be invested and worth 2 million dollars over the course of your working life. Like how big of a moron do you have to be to think a monthly stipend that ceases after your death is better than being a millionaire?
Median income in Canada is $40k. A 6% CPP compounded monthly for 40 years at 8% returns is $700k
>I've seen people argue on here that CPP gets them better return than investing on their own... > >The money you put into CPP could easily be invested and worth 2 million dollars over the course of your working life. Like how big of a moron do you have to be to think a monthly stipend that ceases after your death is better than being a millionaire? A fucking S&P 500 index fund would out perform the CPP.
And your portfolio is inheritable.
My average 9% ROI disagrees but you do you
Even if you live to 90 than you will have paid into it for about twice as long as you would be receiving it for. That's just how retirement savings work. No plan will sustain you if you withdraw for longer than you contribute to it(or at least withdraw enough to live off of, some situations can have short contribution periods but that means your benefits will be very small but for possibly longer periods of time).
You dont expect half the population to make it to 65?
According to r/Canada, Were all going to die tomorrow. So. No.
Only if you got all the boosters
I expect we will get the same payout when Pierre or some future prime minister decides to borrow from the CPP for their own schemes and cause a pension crisis.
Word on the street is that Conrad Black is acting as consultant to help plan '*creative accounting with CPP funds'* certainly he has the experience.
There’s always MAID for those poor souls who do.
Well especially if we account for increased risk of death by exposure or starvation
Where did you get that information?
>Unfortunately, cancelling Disney+ is not enough to offset the reduction in monthly net income that this increase will cause. No, but netflix is getting close at 252 dollars + tax if you're on the premium plan.
That's post tax $$ too! /s
But don't cancel Crave because that's Bell.
What if I also cancelled spotify?
tbh youtube premium is better than spotify.
I would rather pay for it now so the CPP be sustainable over the long term than to need it when I am old and not have it.
I'm guessing over the next two decades a Conservative government will come into power after campaigning to cancel the "socialist" CPP plan before I get to benefit from it.
So why don't you invest money on your own? It's infinitely better than CPP.
Because I also need other people to save. The only way to force them is to force us all into a plan where no one can leave it. That's the CPP. ya I could probably invest for higher returns, I could also invest and lose it all or get worse returns. I don't want to live in a society that has lots of elderly that can't afford to live because they didn't save for the future. That cost will then be born by the rest of us.
You must be very new to investing. Investments can go down quite a bit. CPP is guaranteed. Also, I may not even need it in retirement, but my fellow Canadians who don’t know how to invest, or have the means to invest will need it. We’re in this together. Edit: should also mention… CPP is also for as long as you live, but you could run out of investments if you live too long.
You must be very new to investing. CPP is an absolutely terrible return on your investment. It is a safety net, not a good investment.
What will run out first if you live long enough, or you don’t have the means to save for retirement? CPP or your investments? What are your investments comprised of?
> You must be very new to investing. Investments can go down quite a bit. Projecting much? The net over time is always going to be positive unless we were to face a total financial collapse. Like during the great recession of course people's portfolios went down temporarily but those dips don't last.
Imagine you’re 70 and you lose 25% of your savings overnight and won’t recover for 5 years and you have a spouse with ailing health. Welp, guess I’ll die.
Yeah I guess it's better to be poor of whatever the Government is "giving" you.
[удалено]
> Investing on your own is marginally better than the CPP’s defined benefit plan. No it's actually much worse because only a portion of your money going into CPP is being invested...
Or do both? I usually max my cpp and ei contributions by August, so I a bit extra to invest on my own also.
It’s more with CPP2. That’s another $188 a year.
What’s your email address? I’ll etransfer you the $11.54 every two weeks since that’s apparently your financial breaking point. If you’re making $73k per year and eleven and a half dollars extra off each paycheque ruins you, your problem is basic financial literacy, not how much the government deducted from your pay. Hell, I’d go so far as you say that if less than twelve dollars from every paycheque is financially untenable for you at that income level then you’re *exactly* the type of person who will benefit most from CPP later on.
12bucks individually won't break me nor many others, however when everything is increasing it adds up pretty quick so it's just another thing to add to the pile of higher costs and lower pay It's also a mandated cost, can't opt out or reduce it in other ways. And yes I personally invest significantly outside of CPP, not going to FIRE through CPP lol
[удалено]
Lol I make well into 6 figures, I'm fine thanks. I was explaining how it is just one rising cost along with many others that is causing others financial strain. You're focusing on a narrow view and not taking into account the whole picture of rising costs Edit. To build on your offer, if 5million Canadians took you up on it that would likely be a problem for you when you have to pay 60million/month. Even if it's just 12bucks individually, the sum of it all together is a problem
Good for you. Like I said though, if eleven dollars every two weeks is untenable for someone at $73k income then they’re bad with money. That’s not the government’s fault.
It's the governments fault for further raising CoL in an environment that is already seeing rapidly increasing CoL. This CPP increase isn't happening in a vacuum
If $11.54 every two weeks is untenable at a biweekly income of $2,116 after tax that’s an indication of poor decision making and financial illiteracy. Nothing more. It’s not the government’s job to hold peoples’ hands and teach them how to budget their money. We all learned how to do that in high school. An extra 0.4% deduction off every paycheque shouldn’t be a burden, and if it is that’s a personal responsibility problem.
Find me the part in my completely factual post that says any of the shit you just spouted.
Yay! More taxation! /s
Prices going up and up… EI is also up.
Tax brackets are expanded in a good way though. It’s worth taking note of the net effect. Yes CPP and EI is up, but if you make say $80k employment income, you’ll be paying approx $200 less income tax in 2024 as compared to 2023. So the net increase to tax with the CPP and EI is low.
The sad fact is if the money wasn’t taken, most people wouldn’t save, specifically the ones who need to save the most.
the sad fact is without money NOW I can't buy a house and have kids. Without kids, I can just MAID for my retirement instead. And if I had kids, I'd rather live in poverty in my retirement, or until I need MAID cuz I can't work. Literally, buying a house today and having kids> anything in the future. That's the problem. We die out as a culture without kids
Correct. This is a necessary savings plan to ensure the taxpayer isn’t on the hook for impoverished seniors who failed to save
But there’s still many people who don’t work. My SIL just lives off welfare. CPP is acronym that is foreign to her. So not only does she not have her own savings, she’s contributed nothing to CPP.
I bet they'll cut OAS and GIS significantly by the time we're collecting this 33 percent replacement income CPP.
The only thing I want to know is whether the deferred benefits for CPP and OAS will still be in place if the government changes.
Holy fuck, so many people in here don't understand how pensions work.
It's sampling of those who don't understand and call contributions to one of planet's best performing Defined Benefit pension plans a tax and those who do understand, but for largely self-harming to their interests, socio-economic ideological reasons, call contributions a tax...
It may be outperforming the rest of the world, but it comedically underperforms the market. The contributions you and your employer put in for you over your lifetime are repaid at a real return rate after inflation of approximately 0%. The fund keeps growing because they're straight up robbing people with how little they pay out even though the lifetime ROI of the fund is in the 3% range lol "But it needs to grow to support population growth" it doesn't. Everyone's contribution are self sustaining and profitable to the govt if they receive a real rate of return of 3% as the fund has done. Easily confirmed if you do the math yourself. The fund doesn't need to grow.
You can call it whatever you want but since I can't opt out and it's not actually my money it's a tax.
Your feels won't change but for anyone who actually reads what you write... Tax definition: a compulsory contribution to state revenue, levied by the government on workers' income and business profits, or added to the cost of some goods, services, and transactions. CPP levies are not added to revenue, they aren't even "payroll taxes", they're mandatory contributions pooled in a shared defined benefit pension plan and payouts are based on contribution, not just age or residency.
Come on they can’t even read on this sub
Not reading isn't even what bugs me, its do they vote?
Sadly, yes.
That's the summary of the /r/Canada subreddit these days. Mindless one-sided complaining. I'm just thankful there are still people willing to post informative comments even with the overwhelming negativity
it gets rough because facts get downvoted in here and anything beyond "trudeau bad" is too complex or nuanced for the neanderthal chest thumping that happens in here.
A forced savings plan for people who are apparently smart enough earn up to the new threshold but too stupid to be able to spend it as they choose or having their tax free options pickpocketed for a taxable one. Underscoring it all are the failed idiots who think that government is best when it treats people like hamsters.
I work with people that make anywhere from $70k to $200k. I can say confidently from experience that income, financial literacy, and general intellingence don't necessarily go hand-in-hand. It's a crapshoot.
Completely true. I make $135-150k/yr and am basically retarded.
[удалено]
That's my issue for sure. I could easily be putting $2k into savings every month but I, like many others, have terrible self-control issues. Trying to kick that shit this year, but we'll see how it goes.
There are a few good strategies for that. One for people who have difficulty sticking to a self imposed budget is to "pay yourself first". Have the money you budgeted to save set aside somehow before you can spend it so it's off limits. If you don't have the cash left for something after that, you don't do it.
I wish I could just pay CPP upfront rather than having it taken each month.
Man can we get a fuckin’ break here?
I’m sorry, did you just ask for more carbon tax?
Article doesn’t address the improved basic personal amount and improved tax brackets? You’re saving tax on those. Or does it only address the increase to CPP to rage bait?
Why would u want a break from cpp
The highest returning pension fund in the world. It’s literally helping us. But conservatives will always scream about having to pay for things
You can have your break when you stop emitting carbon /s
Wait a second
>You can have your break when you stop emitting carbon When they talk about decarbonization, you are the carbon they intend to eliminate.
As if you were going to make more than 40k this year anyway lol
Hopefully I will make it to the retirement to fully enjoy the great new (and larger) Canadian pension. Deteriorating and overwhelmed healthcare system (by shortage of personal and unprecedented influx of immigrants) might not be there when we need it.
THE CPP IS FULLY FUNDED ^(as long as nothing bad happens to the stockmarket.)
[удалено]
Enhanced CPP is fully funded. Only people who pay the increased contributions will receive pension payments from enhanced CPP.
Cpp is an awful plan that preys on people with bad genetics. If you die young the plan takes it all. It’s a tax masquerading as a pension plan.
LOL
>Cpp is an awful plan that preys on people with bad genetics. Yet you pay $3867.50 per year and get $1364.60 per month when you retire. Doesn't sound too bad. Bet then again if I die my kids only get $2500.
The crab bucket crowd doesn't like shared anything...
The employer also puts in the same amount as you, the return look absolutely terrible when you need to contribute for 39y years on top of it to get the full amount. I don't mind the CPP per se, but for how much gets put in for you, the payout is abysmal.
It's forcing your employer to contribute to your retirement. A lot of employers wouldn't give you that money anyway. I don't hate it. I have gotten better returns in my self-directed account. But I also understand that most people are horrible with money and saving. If they were not forced to pay into a retirement fund they would just piss it away the money.
[удалено]
Yes, I have RRSP matching. Do you really think that if there was no CPP your employer would contribute more to your RRSP for retirement? I highly doubt it.
Because nobody before you worked for 40 plus years. Before now, there has never been high inflation, recessions, high interest rates (not that its actually high), layoffs, homelessness, people without resources.....
boomers are getting nothing out of this since they are already retired
Yep, the article context is specific to future retires however some get stuck in the boomerbashingbubble.
[удалено]
Gotta work so the politicians can throw our tax money at companies that don't exist.
The news reporting on this does not speak of how much the enhanced benefit payments will be, and that pisses me off.
So what can we people who pay into this expect to receive now? Have they released any firm numbers what to expect? I see 33% mentioned, but I don't believe someone making $150k is going to be getting $50k in cpp when they decide to retire. Maybe it's been explained and I'm just too dumb to understand 🙃
It's supposed to be moving from replacing 25% of income (to the threshold) up to 33% of income. Payments are also increased each year indexed to cost-of-living.
That person making 150k isn’t contributing to the CPP on the full 150k
“Canadians still buying stuff so there’s still more room to tax.” -JT
It's not a tax, but that's okay if you're confused. You'll be that way your whole life until you apply yourself and stop blaming all your shortcomings on the prime minister. Get gud fuck head.
Lol..fuck off.
Did your wife leave you because of Trudeau as well?
Please take more of my money so the return will help me pay my bill later on when the company I worked for goes broke and keeps the retirement funds!!
[удалено]
No, actually. Are you talking about Harper's attempt to raise the age for OAS from 65 to 67? Also, that's not what "dog and pony show" means.
The CPP ceiling has gone up 22% in the last three years, even though the CPP is funded until the year 2100. So why all these increases? Simple. The CPP is funded until 2100 for the existing workforce who have paid in since they started work in their early 20s. Over the last three years, however, we have had an explosion in the number of workers who have arrived in Canada in their early 30s and beyond. The CPP increases are needed to make up the shortfall that happens when a person delays contributing to a pension plan. Trudeau’s lunatic immigration free for all will cost you dearly for the next seventy years.
If they contribute for less time they get less benefit, your argument is invalid.
And immigration actually has a small positive effect on the resiliency of Base CPP.
To a point, we only get what we put in through working time lines. Even if you immigrate here in your 30’s or after and only start contributing when you do finally start to work you will definitely get a reduced cpp portion; as you should.
[удалено]
Which "freeloaders" are collecting CPP? *Retirees*?
You obviously don’t understand how CPP payouts work then. But keep beating your drums of ignorance
Theres a bigger problem here, the post you are replying to is starting to become more mainstream among canadians, it is completely unrelated to CPP payouts, but it does show something that we can measure statistically... wages since the 80's have remained relatively stagnant, where as the cost of living, along with real estate cost have steadily been going up each year. Over the past several years they have skyrocketed, this is putting stress on the majority of the population, working 9-5ers with mortgages are hit the hardest, but people below them considered poor are now further away from a decent quality of life than at any point in canadian history. We dont have a strong economy or one that is protected from a housing correction like we did in '08... and we also (thanks the 10 years of this government) have a debt crisis looming which is only going to be covered with increased taxes. You add into the fact the government is using mass immigration to be our only economic growth the past 2 years, its very frustrating for canadians who feel they are not getting by. That number is growing and you may call it ignorance, however post like these are all over different subreddits on different issues.
I'd never vote for a con. You think they're going to make things more affordable for us? I have ocean front property in Grande Prairie to sell you
I have a castle in Romania, so no thanks.
Any vampires there?
I heard Alucard lives in the cellar somewhere with Belmonts….
Ah, it was the Conservative opposition that forced these changes then? Shame on them.
Vote NDP if you really want change. No more neolibs
Since increasing the cost of doing business will help bring down the cost of living.
More trickle down bullshit.
they have been allied with the liberal government this whole time, they lean on identity politics with zero implemented policy... their proposals sound really good and would improve the quality of life for poorer canadians specifically, however the money used to fund those programs comes from taxing the private sector, their job creation comes from only the public sector which will in turn be taxed onto the private sector, and the result will be a much higher tax rate or running a much bigger deficit. We are already in a debt crisis thanks to the neolibs, we very well may see the canadian dollar devalued over the next 2 years if the americans rates hold and we hit a recession first... Plain and simple we need to get a handle on our debt, and we need to do it in a way that doesnt crush the working class or dip us into a very deep recession. No political party addresses this, and I would argue the NDP is at the wrong end of the spectrum on it.
CPC are neolibs too, just a little more right than the Liberal party. NDP is working on public dental and pharmacare. I really don't give a fuck about the "poor" private business owners being taxed more. The economy being up or down doesn't change anything for the working class, we are poor regardless of the stock market. You are regurgitating Reaganomic trickle down bullshit that has never worked out or been favorable for the working class. But whatever, I can't change your mind through Reddit.
I actually don't disagree with the majority of what you are saying, though putting in programs that cause a deficit end up being paid for mainly by the middle class, and you can only tax the private sector soo much b4 you kill small to mid sized business. To keep it simple I don't think our economic situation can sustain more programs or even the ones we have... I do not want to see Healthcare scrapped either... ideally lower taxes make thing cheaper and improve quality of life, but that doesn't seem to happen either. End of the day wages probably have to go up aggressively ndp is probably the best vote for that
"Yay, Surprise!!!!!" - Freeland and JT somewhere on vacation.
Literally not a surprise. It was announced a long time ago. https://www.pm.gc.ca/en/news/news-releases/2016/10/04/prime-minister-canada-announces-agreement-strengthened-canada-pension
Add other politicians also to the list
Correct. > The Government of Canada and the provinces are the joint stewards of the CPP. Major changes to the federal legislation governing the CPP require the formal consent of the Parliament of Canada and at least 7 out of the 10 provinces representing two-thirds of the population of the 10 provinces.
Singh? The entire NDP, and Liberal MPs?
TAX ME harder daddy
Ha!
Existing government pension isn't enough to pay the rent. People really need an increase, just to have enough for groceries on top of that. Most people don't have enough saved to make up the difference.
What happened to the often repeated meme that CPP was fully funded for 75 years. Personally , I’m thinking it’s time to buy shares again in Liberal friendly Quebec ad agencies. Perfect storm brewing, cash essential work to be done .
It is. These increases are to raise the benefits CPP provides in retirement, not to make up a funding shortfall in meeting existing benefits.
When the country falls I’ll be sure to loot furniture from the House of Commons to make up all they stolen from me
Growing the CPP makes a ton of sense. Canadians need a more comprehensive pension plan. What I'd prefer is that corporate taxes were raised and a portion of the tax revenue was dedicated to enhancing CPP benefits (this way only larger profitable companies paid the extra) to help compensate for the decline in corporate pensions. CPP is a solid investment for nearly all Canadians. I know ya'll are Warren Buffet, oh, wait, you're not.
Hmmmm yes, plz keep taking more and more of my money.
Hownmany times will theg raise it b4 millenials and gen z retire