What Does Retirement Actually Cost in Canada? (2026 Benchmarks)

How much will you actually spend in retirement? It's one of the most common questions in retirement planning — and one of the hardest to answer, because it depends on your health, your housing, where you live, and what kind of retirement you want.

Fortunately, Statistics Canada tracks what Canadian households actually spend. Here's what the data shows, what it could mean for your plan, and how to start figuring out your own number.

This article is for educational purposes only and does not constitute financial advice. See full disclaimer at the bottom.

Build your personal spending plan →

What Canadian Retirees Actually Spend

Based on Statistics Canada's Survey of Household Spending (Table 11-10-0227-01, 2021 data), the average household where the reference person is 65 or older spent approximately $61,855 per year — roughly $5,154 per month.

That's noticeably less than the $99,623 spent by households aged 55–64. The drop may reflect a common pattern: spending tends to decline as people age, often driven by lower transportation costs, fewer work-related expenses, and shifting priorities.

For context, the all-ages Canadian household average was $76,750 in 2023.

Where the Money Goes (Age 65+)

Category	Annual	Monthly	% of Budget
Shelter	$13,814	$1,151	22.3%
Food	$7,670	$639	12.4%
Transportation	$5,416	$451	8.8%
Healthcare	$3,450	$288	5.6%
Insurance & pensions	$3,356	$280	5.4%
Household operations	$3,275	$273	5.3%

Source: Statistics Canada, Survey of Household Spending, 2021. Table 11-10-0227-01.

A few things stand out. Shelter is the largest category at 22% of the budget — and it varies widely depending on whether you own outright, carry a mortgage, or rent. Healthcare, at 5.6%, may seem low, but this reflects averages across the population. For retirees with significant dental, vision, or prescription costs not covered by provincial plans, this number could be much higher.

---

Why Averages May Not Fit Your Situation

The $61,855 figure is an average across all 65+ households — including retirees who own their homes outright, retirees who rent in Vancouver, couples, and singles. Your actual spending could be quite different.

Factors that push spending higher

• Renting or carrying a mortgage — shelter costs can double compared to owning outright
• Living in a high-cost city — Vancouver, Toronto, and parts of BC/ON have significantly higher shelter and food costs
• Travel in early retirement — the "go-go" years (65–75) often involve more discretionary spending
• Health issues — dental implants, hearing aids, home care, and prescription drugs could add $5,000–$15,000 per year
• Supporting adult children or grandchildren — a sometimes overlooked expense

Factors that push spending lower

• Owning your home outright — shelter drops to property tax, insurance, and maintenance
• Living in a lower-cost province — Quebec, Manitoba, and the Atlantic provinces tend to have lower costs
• The "slow-go" and "no-go" years — spending typically declines after 75 as travel and recreation decrease
• No commute, no work wardrobe — transportation drops significantly

---

Singles vs Couples

According to Statistics Canada's Canadian Income Survey (2023 data), the median after-tax income for senior families was $79,700/year. For unattached seniors, median after-tax income tends to be significantly lower — roughly half, based on earlier survey years.

Couples may benefit from shared shelter costs, shared vehicle expenses, and pension income splitting. A rough rule of thumb suggests a couple may need about 1.5 to 1.7 times what a single person needs, not double.

For a single retiree, a reasonable starting range might be $30,000–$45,000 per year depending on housing. For a couple, $50,000–$75,000 is a common range. But these are starting points — your actual number depends on the factors above.

---

The Three Phases of Retirement Spending

Retirement isn't one long period with constant spending. Many planners — and RetireZest — model three phases:

Active years (typically 60–74)

This is often when spending is highest. Travel, dining out, hobbies, home renovations, and helping family are common. Some retirees spend more in these years than they did while working, because they have time.

Moderate years (typically 75–84)

Spending gradually declines. Less travel, less driving, more time at home. But healthcare costs may start to rise, partially offsetting the savings.

Quiet years (typically 85+)

Discretionary spending often drops significantly. Healthcare and potential long-term care may become the dominant expenses. Some retirees in this phase spend very little beyond shelter, food, and medical costs — while others face large care-home bills.

This is why a single spending number for "retirement" may be misleading. RetireZest lets you set different spending targets for each phase, which may produce a more realistic projection than assuming flat spending for 30 years.

---

How to Estimate Your Own Number

Rather than using the national average, start with what you actually spend today. Then adjust:

Step 1: Track your current spending. Look at the last 12 months of bank and credit card statements. Many people overestimate discretionary spending and underestimate fixed costs.

Step 2: Remove work-related costs. Commuting, work clothes, lunches out, professional dues, CPP/EI contributions. These typically go away in retirement.

Step 3: Add retirement-specific costs. Travel plans, increased healthcare, home maintenance you've been deferring, hobbies you want to pick up.

Step 4: Adjust for housing. If you'll have your mortgage paid off by retirement, your shelter costs may drop by $1,000–$2,000/month. If you plan to downsize, factor in the sale proceeds and lower ongoing costs.

Step 5: Account for inflation. At 2% inflation, $60,000 today is equivalent to roughly $73,000 in 10 years. RetireZest adjusts spending for inflation automatically in every simulation.

---

How Government Benefits Fit In

CPP and OAS may cover a meaningful portion of retirement spending, but for many Canadians they don't cover all of it.

Benefit	Maximum Monthly (2026)	Average Monthly
CPP (age 65)	$1,507.65	~$804
OAS (age 65–74, full 40 years residency)	$743.05	Varies by years in Canada
GIS (single, if eligible)	up to ~$1,105	Varies

Source: Service Canada. CPP average as of Oct 2025. OAS is for Q2 2026 (Apr–Jun). Amounts are updated quarterly.

A couple both receiving average CPP ($804/month each) and full OAS ($743/month each, which requires 40 years of Canadian residency) might get roughly $37,100/year combined. Against an average spend of $61,855, that could leave a gap of about $24,000/year that would need to come from savings — RRSP/RRIF, TFSA, non-registered accounts, or corporate accounts.

For more on how much savings you need to fill that gap, see our guide on how much to retire in Canada. For strategies on which accounts to draw first, see RRSP vs TFSA in retirement.

---

What About Healthcare?

Provincial health insurance generally covers doctor visits and hospital stays, but many retirement healthcare costs may not be covered:

• Dental care — cleanings, implants, dentures
• Vision — glasses, cataract surgery (varies by province)
• Prescription drugs — partially covered in some provinces, not in others
• Hearing aids — $2,000–$6,000 per pair
• Home care — personal support workers, if needed
• Long-term care — nursing homes may cost $2,000–$8,000/month depending on province and level of care

The Statistics Canada average of $3,450/year for healthcare may not reflect the experience of all retirees, especially those over 80. If you don't have employer retiree benefits, some planners suggest budgeting $5,000–$10,000/year for healthcare in later years — though this varies significantly by province and individual health.

---

How RetireZest Helps

RetireZest models your spending across all three phases (active, moderate, quiet) and projects whether your savings — combined with CPP, OAS, and any other income — may cover it. The simulation accounts for:

• Inflation-adjusted spending year by year
• Provincial tax differences (AB, BC, ON, QC)
• CPP/OAS timing — when to start affects how much you receive
• OAS clawback — high income can reduce your OAS
• Withdrawal strategy — the order you draw from RRIF, TFSA, and other accounts may change your tax bill
• Monte Carlo stress testing — what happens if markets drop early in your retirement

Instead of guessing whether $60,000/year is enough, you can model your actual situation.

See how your spending plan holds up →

---

Key Takeaways

• The average Canadian household aged 65+ spent $61,855/year in 2021, according to Statistics Canada
• Shelter (22%), food (12%), and transportation (9%) are the three largest categories
• Spending typically declines with age, but healthcare costs may rise — especially after 80
• CPP and OAS may cover roughly $30,000–$38,000/year for a couple, potentially leaving a gap that savings would need to fill
• Your personal number depends on housing, province, health, and lifestyle — national averages are a starting point, not a target
• Modeling three spending phases (active, moderate, quiet) may produce more realistic projections than assuming flat spending

---

This article is for educational purposes only and does not constitute financial, tax, or legal advice. The Statistics Canada figures cited are from the 2021 Survey of Household Spending (Table 11-10-0227-01) and the 2024 Canadian Income Survey. Government benefit amounts are approximate 2026 figures and are updated annually by Service Canada. Your actual spending and income will depend on your individual circumstances, province, and health. RetireZest is not a registered financial advisor, dealer, or tax professional. Always consult licensed professionals before making financial decisions.