How much is needed to retire in Canada?
Despite the strength of the U.S. dollar versus the loonie, the cost of retiring in Canada may be surprising to Americans.
A recent Bank of Montreal survey suggests Canadians believe they need C$1.7 million to retire, or roughly $1.3 million. That’s about equal to the expectations of Americans, who say they need $1.27 million to retire comfortably.
Even if it ends up costing the same amount overall to retire in Canada as it would in the U.S., there are other factors to consider regarding one’s retirement needs.
There are also tax hurdles you may need to deal with, and certain requirements must be met to access universal health care.
Meet Your Retirement Goals Effortlessly
The road to retirement may seem long, but with WiserAdvisor, you can find a trusted partner to guide you every step of the way
WiserAdvisor matches you with vetted financial advisors that offer personalized advice to help you to make the right choices, invest wisely, and secure the retirement you've always dreamed of. Start planning early, and get your retirement mapped out today.
Get Started
Here’s what it takes
If you’re considering Canada, numerous expatriation-focused websites can guide you through the sometimes tricky paths to gaining long-term entry to the country, as well as the tax implications and liabilities of maintaining dual citizenship should you choose that route. Here are some additional distinctly Canadian considerations.
Health care
Canada’s universal health care is only accessible to citizens and permanent residents. There are several paths to gaining permanent resident status. In the meantime, you may have to acquire private insurance.
The nation’s health-care system can provide access to comprehensive coverage, although it’s important to note that certain provinces may have longer wait times for certain procedures, and prescription medications may not always be fully covered. Access to more complex procedures have often sent American retirees back to the U.S. for care.
Taxes
American citizens must file tax returns annually with the U.S., regardless of where you live. Your tax obligations to Canada can depend on whether you’re considered a resident or visitor.
Canada has a progressive income tax system, meaning higher-income individuals pay higher tax rates. Provinces also have their own tax systems as well.
Exchange rates
Retirees considering Canada should be mindful of exchange rates if their retirement savings are in a different currency. Things can change quickly, and fluctuations in currency values can significantly impact purchasing power and overall financial stability. The price tags on common goods — such as gas or groceries — can be shocking if you ignore the currency exchange rate.
Retiring in Canada offers numerous advantages, including a high standard of living, excellent health care and beautiful landscapes. But it’s essential to carefully assess your financial situation and consider factors such as the cost of living, health coverage, taxes and lifestyle preferences.
More: These are the best states to retire in
Sponsored
Meet Your Retirement Goals Effortlessly
The road to retirement may seem long, but with WiserAdvisor, you can find a trusted partner to guide you every step of the way
WiserAdvisor matches you with vetted financial advisors that offer personalized advice to help you to make the right choices, invest wisely, and secure the retirement you've always dreamed of. Start planning early, and get your retirement mapped out today.
