I saved practically nothing for retirement. Now I’m 60 and laid off with no real plan except government benefits — how can I survive?

What do you do when your 60th birthday rolls around and you haven’t saved much, if anything, for retirement? Imagine Ryan, a single man from Regina, SK, who found himself in this situation shortly after he lost his job during a company restructuring. Ryan isn't real but the situation presented here is one that is common for many Canadians.

Ryan had planned to work two more years before claiming Old Age Security (OAS) and Canada Pension (CPP) benefits — at an already reduced rate — and had no idea how he could make ends meet for another 20 years or more.

According to recent surveys, more than half of Canadians aged 50 and older don’t have a retirement savings plan (1), and over 60% say they worry about running out of money in retirement (2). The maximum OAS payment for newly retired workers aged 65 in 2025 is $859.80 monthly, but that number includes people who were high earners or took their benefits at age 65 or older. If you’re like Ryan and are forced to take your benefits early, your monthly cheque could be much less.

The good news is that people in this situation still have a viable path to financial security, if they make the right moves. The key is to raise your income where you can, take advantage of all the benefits available to you and cut your fixed costs until the math works. The process won’t be easy, but with discipline and determination, you can put your mind at ease.

Explore savings options

Doomscrolling personal finance websites can give you a false sense of security about your situation. A BMO Financial Group survey from earlier this year found that, on average, Canadians believe they’ll need over $1.5 million saved for a comfortable retirement (3).

How accurate is that number? In Canada, the widely cited “4% rule” — developed in the U.S. by financial planner William Bengen in 1994 — suggests retirees could withdraw 4% of their savings in the first year, and adjust for inflation annually to last for a 30-year retirement. But this requires successful management of both income and spending (4).

Canadian data shows that using the 4% rule without modification may be overly optimistic. For example, lower interest‐rates and longer lifespans mean the “safe” withdrawal rate for some Canadians could be below 4% (5). More recent Canadian commentary suggests that while 4% remains a useful starting point, each retiree’s withdrawal strategy must consider variables like their investment mix, retirement length, government benefits such as CPP and OAS amounts, emergencies, tax changes and ever-evolving market conditions (6).

Assuming you’re healthy and able to work, strongly consider delaying when you claim OAS benefits for as long as you can. If you wait until 70, your guaranteed monthly benefit will increase by 0.6% for each month you wait, or 7.2% annually, up to a maximum of 36% (7). For example, if your OAS benefit at age 65 is $727.67 monthly (the maximum for 2025), delaying it to 70 would boost your monthly amount to $989.63 (8).

Since the amount that OAS offers isn’t enough to live on, you’ll also want to take advantage of the CPP — you must be at least 60 years old and have made at least one valid contribution to CPP in order to qualify.

You can start collecting your CPP as early as 60 or up to age 70 and, just like the OAS, delaying your payments will result in higher monthly amounts. For example, if you delay collecting CPP, payments increase by 0.7% each month (8.4% per year), up to 42% at age 70 (9). In 2025, the average monthly CPP amount was $848.37 and the maximum benefit was $1,433 (10).

Sponsored

Smart investing starts here

Build your own investment portfolio with CIBC Investor’s Edge online and mobile trading platform. Enjoy low commissions on trades and special pricing for active traders, students and young investors.

Get started today

What to do in the meanwhile

To buy time so you can claim OAS and CPP later, you’ll need to continue to work. Service Canada and Job Bank can connect you to job openings, employers and local hiring resources, while also offering career training. Also, contract and gig work may be able to help you, but remember to set aside money for income and self-employment taxes.

If your current or prospective role doesn’t offer a pension, you can open your own tax-advantaged account and automate your contributions. In Canada, the annual contribution limit for a Registered Retirement Savings Plan (RRSP) in 2025 is 18% of your earned income from the previous year, up to a maximum of $32,490 (11).

Cut costs wherever you can

Housing costs are a burden on many these days, but there are ways to lower them. Is your current space more than you need? Consider downsizing, whether that means moving to a smaller place if you rent or moving into a shared rental with roommates. On the flip side, if you own your home, explore renting out a room to earn more cash.

Given the challenges of the current economic landscape, it’s worth examining all support programs available to you. For help with food, income or housing insecurity, consider applying for the HST credit, your provincial social assistance program (Ontario Works, for example) or any other program you may be eligible for.

Through his bank, Ryan met with a personal financial advisor who gave him some bedrock advice for free. Your very first step should be to build a zero-based budget for the next 60 days, and track all income and expenses to get a clear picture of your true baseline budget. Many Canadian financial institutions like BMO, RBC and TD offer free online budgeting tools to help you get started.

At 60 with no savings, your plan shouldn’t include counting on a winning lottery ticket. Though Canadians may dream of a seven-figure nest egg, many are able to retire with far less.

Article sources

We rely only on vetted sources and credible third-party reporting. For details, see our editorial ethics and guidelines.

Benefits Canada (1); CPP Investments (2); BMO (3); RBC Wealth Management (4); Canadian Money Saver (5); Million Dollar Journey (6); Canada (7, 8, 9, 10); Fidelity (11);