When should you take CPP?

If I had a YouTube channel, the surest way to get at least a couple thousand views with tons and tons of comments would be to post a video about when to take CPP. The more provocative the title, the better. Here are some titles of videos sent to me over the last month. The bold italics are mine.

• Taking CPP at 60 vs. Waiting: The Hidden Math You Need to Know
• Claiming Your CPP At 60 Changes EVERYTHING In Retirement
• CPP: Stop Waiting Until 70? The Math Nobody Shows You

There is no hidden math, and all data related to CPP is publicly available at the government of Canada, the CPP Investments website, and the CPP Actuarial Report.

Changing any variable in a projection changes EVERYTHING about that projection. I know YouTubers need provocative titles, but any change you make to your financial plan will change all the future projections (i.e., EVERYTHING) about said plan.

And if you’re showing the math nobody shows, then are you nobody?

I wrote about the nuance of when to take CPP last year. My views haven’t changed. When to take CPP is personal and involves lots of considerations, some qualitative, some quantitative. I’ve included a non-exhaustive list of those considerations below.

But before I get to that list, I need to address an unfair thing a lot of content creators say about advisors who advise their clients to take CPP at 60: there is nothing wrong with that advice if it’s based on your own unique circumstances. If they have a page on their website that says, “All clients should take CPP at 60 no matter what,” then they’re probably subpar advisors. But if you took CPP at 60 because it made sense, then so be it.

• Your actual CPP income amount.
• Your employment status and whether you anticipate working part-time in retirement.
• Your health and life expectancy.
• Your risk tolerance and expected investment returns.
• If you value a guaranteed, inflation-linked income over drawing from your investments.
• Your marital status.
• What your spouse elected.
• Your current and projected tax rate.
• Your anticipated pension income (and bridge benefit and/or temporary annuity)
• Your anticipated OAS income.
• The current and anticipated value of your RRSP/RIF.
• The current and anticipated value of your TFSA.
• If you’re incorporated or have a corporate investment account.
• If you have other retirement income sources.
• If you’re charitably inclined.
• Your RRSP contribution limit.
• Your retirement income needs earlier in retirement.

Don’t take financial advice from the internet. Look at the comments of any YouTube CPP video and you’ll see comments that say, “I took CPP at X because of circumstance Y and I’m glad I did.” You don’t often find reason in the comments section. But it’s there when talking about CPP.