Canada pension plan (CPP) and maximum benefit recipients in retirement: a profile of an exclusive group and gender differences

Over the next several years, the number of Canadians reaching retirement age will increase substantially. The ability of retirees to realize an adequate retirement income that allows them to experience a decent quality of life in their senior years will undoubtedly emerge as a critical public policy issue. This paper profiles the characteristics of Canada Pension Plan (CPP) recipients aged 65 and over who received the maximum benefits according to yearly thresholds established by the federal government. Being among the maximum group is exceedingly difficult given the long period required to contribute (39-plus years) and the relatively high level of employment income needed. The analysis shows that the maximum earning CPP group comprises less than 5% of the sample. It also reveals that those who are among the maximum earners and those who are not differ significantly with respect to gender, after-tax income, pension benefits, employment status, education, occupation, industry, and region of residence. Given these results, we discuss if maximum CPP earnings is a useful measure of career longevity and satisfaction. The findings provide policymakers with a current picture of maximum benefit recipients while also offering insights into the factors that enable the CPP to provide recipients with a more secure retirement when the program’s full potential is utilized.