While $1.7 million is a big number, it’s possible to retire in Canada on that amount, if you start an RRSP early in life and contribute to it every year.
If you’re just starting out on the long road to saving for retirement, you may have heard about BMO’s recent poll, which found that Canadians say they will need $1.7 million to retire.
Because of inflation, according to the press release, that number is 20% higher than it was in 2020, when it was $1.4 million. I wrote my initial take on the poll on my own site, citing the Canadian Press article in the Financial Post as my main source. I wrote that you’d have to put away $42,400 every year in a registered retirement savings plan (RRSP) for 40 years (between the ages of 25 and 65) to reach $1.7 million. That’s more than double what even top earners are allowed to contribute. But, as you can see below, if you start saving in an RRSP early enough, you won’t need to save nearly that much each year.