CPP/QPP report

This page shows the CPP/QPP pensionable earnings used in the TIME MACHINE run, plus a return summary for the projected CPP/QPP contributions and benefits.

Pensionable earnings table

There is one pensionable earnings table for each person. Past years come from the CPP/QPP earnings history stored for that person. Future years are projected by TIME MACHINE, using the run assumptions and future YMPE indexing.

  • Year is the calendar year for the row. Future projected rows are shown in italics.
  • YMPE is the annual maximum pensionable earnings amount used for that year.
  • Pensionable earnings are the earnings counted for the base CPP/QPP calculation, limited by the annual maximum.
  • First additional is the earnings base used for the first additional/enhanced CPP/QPP benefit.
  • Second additional is the earnings base above the first ceiling, up to the second ceiling, where applicable.
  • Months included is the number of months from that year that remain in the CPP/QPP calculation after the applicable contributory-period and dropout rules.

The last row summarizes the pension calculation. Age started is the CPP/QPP start age used in the run. Factor is the early or late start adjustment. Avg. Earnings, Avg. First Add., and Avg. Second Add. are the average earnings components used to estimate the pension. Total (today $) is the estimated annual CPP/QPP amount in today's dollars, and Total (future $) is the estimated amount at the future start date.

For couples, the Combined pensions table may appear for the surviving spouse after the first spouse dies. It shows the estimated CPP/QPP amount after applying the survivor pension and combined pension rules. Combined start is the date when that survivor/combined amount begins, Age is the surviving spouse's age at that start date, and Combined amount is the estimated annual CPP/QPP amount in today's dollars.

CPP/QPP return tables

The return tables treat CPP/QPP contributions as cash outflows and projected CPP/QPP benefits as cash inflows, up to the projected death year in the TIME MACHINE run. For couples, the household table combines both people's cash flows.

  • Lifetime contributions are the CPP/QPP contributions included in the analysis, adjusted to today's dollars using YMPE. They do not include employer contributions except in the case of self-employment employer contributions in future years.
  • Lifetime benefits are the CPP/QPP benefits projected by TIME MACHINE, adjusted to today's dollars using YMPE. They include PRB amounts and any CPP/QPP pension sharing adjustments calculated in the run.
  • Net lifetime value is lifetime benefits minus lifetime contributions, in today's YMPE-adjusted dollars.
  • Payback age is the first age when cumulative YMPE-adjusted benefits exceed cumulative YMPE-adjusted contributions. This is not the same as a CPP/QPP claiming-delay breakeven age, because the start age has already been chosen in this run.
  • Real annual return is an internal rate of return, or IRR. It is the steady annual wage-real return that would make the contribution cash flows grow into the projected benefit cash flows. A higher return means more projected benefit for each included contribution dollar.
  • Average contribution level is the average pensionable earnings level as a percentage of that year's maximum pensionable earnings.
  • Years at maximum counts years where pensionable earnings reached the year's maximum pensionable earnings.
  • Years collected counts the projected years with CPP/QPP benefits paid in the TIME MACHINE run.
  • PRB included shows the portion of lifetime benefits from post-retirement benefits, already included in the lifetime benefits total.

The chart shows cumulative YMPE-adjusted contributions and cumulative YMPE-adjusted benefits over time. The point where the benefits line rises above the contributions line corresponds to the payback age.

The real annual return is helpful for comparing the pattern of contributions and projected benefits, but it is not a guaranteed investment return, not the CPP Investment Board return, and not a recommendation to start CPP/QPP at a particular age. It depends on the start age, projected death year, earnings history, projected future earnings, and the benefits calculated in this TIME MACHINE run. Compare it cautiously to investment returns because CPP/QPP also includes longevity insurance and inflation-indexed lifetime payments.