Retirement Goals in 2025: Smart Ways Canadians Are Adapting

Insight and advices

Why Canadians Are Rethinking Retirement Goals in 2025

Jun 13, 2025

What does a “comfortable retirement” look like in 2025? For many Canadians, the answer has changed—and quickly. New surveys show that more than 60% of Canadians are concerned about not having enough savings. In just one year, the average retirement goal has jumped from $700,000 to $900,000.

This shift isn’t just a number—it reflects rising costs, longer life expectancies, and growing uncertainty about the future. If you’re planning for retirement, it’s time to rethink your own targets too.

The Wake-Up Call: Retirement Confidence Is Shrinking

According to a 2025 survey by State Street Global Advisors and other financial institutions, fewer Canadians feel confident they’re on track for retirement. Even though the average desired age for retirement remains around 64, the ability to achieve that is slipping.

Why? Here are the main factors:

Inflation has made everyday essentials more expensive
Housing and rental costs are up nationwide
Healthcare expenses are expected to rise in retirement
Market volatility has shaken confidence in investment returns

As a result, Canadians are revisiting what retirement will actually cost—and how much they’ll need to save to get there.

From $700K to $900K: Why the Goalposts Are Moving

In past years, many Canadians felt that saving $700,000 would be enough for a secure retirement. But recent data suggests that number has risen sharply to $900,000—a 29% increase.

This new target is based on a few key realities:

People are living longer, which means more years of retirement spending
Interest rates and inflation reduce the value of fixed incomes
Private pensions are less common, placing more pressure on personal savings
The cost of assisted living and elder care has climbed dramatically

For a couple retiring in their 60s, $900,000 may seem daunting—but it may also be necessary to maintain a middle-class lifestyle for 25–30 years post-retirement.

Canadians Are Taking Action—But Gaps Remain

The good news? Many Canadians are responding to this shift by increasing their savings rates, making catch-up contributions, or delaying retirement. According to the survey:

34% of respondents are saving more than they did last year
21% are considering working past age 65
14% plan to delay CPP (Canada Pension Plan) to receive a larger monthly benefit

However, there are still gaps:

Many don’t have a formal financial plan
Younger Canadians often underestimate how much they’ll need
A significant portion of mid-career workers haven’t increased their savings despite inflation concerns

This highlights the importance of early and informed planning—not just saving more, but understanding how your money will work for you over time.

How to Reassess Your Own Retirement Goals

If you’re feeling uncertain about your retirement future, you’re not alone. The key is not to panic—but to adapt. Here are some steps to consider:

1. Recalculate Your Retirement Budget

Make a realistic list of future expenses:

Housing (mortgage or rent)
Travel or leisure goals
Healthcare and insurance
Taxes, inflation, and unexpected costs

Use updated numbers. A $900,000 goal in 2025 isn’t arbitrary—it reflects what it may cost to live comfortably for two or three decades.

2. Diversify Your Savings

Instead of relying on one account type (like an RRSP), consider:

TFSA for tax-free growth and withdrawals
Non-registered accounts for flexible income
RRSP for tax-deferred savings
RESPs or FHSA if supporting kids or grandkids indirectly affects your goals

3. Delay Withdrawals If You Can

Every year you delay drawing from CPP or your RRIF may boost your income and reduce your tax burden later.

Retirement Goals Aren’t Just About Money

Yes, retirement is about finances—but it’s also about lifestyle. Many Canadians are redefining retirement not just as “not working” but as:

Working part-time or freelancing for fulfillment
Downsizing or relocating to reduce costs
Prioritizing experiences and health over luxury

The concept of retirement has evolved. Your retirement goal should reflect your values, not just a dollar amount.

Final Thoughts

As Canadians adjust their retirement goals, one thing is clear: retirement in 2025 isn’t what it used to be. With inflation, longevity, and market shifts in play, the path to financial freedom looks different—but it’s still possible.

If you’re in your 40s, 50s, or even early 60s, now’s the time to: