**This is a sponsored post written by me on behalf of the Canadian Pension Plan Investment Board. All opinions are my own.

I think it’s safe to say that many people freak out when it comes to saving for their retirement. Some people may have not saved anything while others may not think they’re saving enough. There’s no denying that saving for retirement is tricky, but how much do you need and should you be stressing out about it?

Well, it really depends on your situation. Someone who’s in their mid-50’s without much saved is likely going to be more worried than a new grad who just landed their first job. Regardless of your age or situation, here’s why you shouldn’t freak out about saving for retirement.

3 Reasons why You Shouldn't Freak out About Saving for Retirement

It’s all about balance

Listen, I have no problem with anyone who wants to spend their money on the things they enjoy, but it’s all about balance. When I do my budgeting, I list all of my expenses first and then I follow that up with things that I’m saving for. By doing this, I’m paying myself first. Any money I spend on fun things doesn’t matter since I know I’m already saving.

I know that doesn’t sound very appealing to some people, so let’s put it into perspective. Let’s say you spend $500 every month on eating out. Would you really be giving that much up if you decide to spend 10% less? That $50 that you save could be put towards your retirement savings which could go a long way.

Alternatively, instead of paying for that vacation you insist you need with your credit card or line of credit, how about paying for it with cash you’ve saved so you don’t have to pay any interest charges?

You may not actually need to save as much as you think

One thing that annoys me about many retirement stories you see online is how they suggest you need to have X dollars saved by X age or X dollars when you retire. For example, you might come across a study that says you should have $20,000 saved by the time you’re 25 or you need $2 million to retire comfortably.

Sure it would be great to have that much saved, but how realistic are those numbers? Those numbers are totally subjective and when you read the fine print of the studies, it seems like you need a mathematician to figure out how they came up with the formula.

Don’t get me wrong, I believe people should be saving more for their retirement, but I don’t think it makes sense to say that everyone should have a set amount of money saved by a set time. How much you should have saved or how much you’ll need when you retire depends on your individual situation and it may not be nearly as much as you think.

You already have an investment advisor

Many people have heard about the Canadian Pension Plan, but they don’t really know how it works. As of 2018, there was a maximum payout of $1,134.17 per month for those who claimed their CPP benefit at the age of 65. But what’s really interesting about CPP is what happens behind the scenes.

The CPP fund that pays the country’s pension benefits is run by the Canadian Pension Plan Investment Board (CPPIB), which is not controlled or run by the government. The CPPIB is essentially a shared investment advisor that Canadians have managing their money with a sustainable, well-diversified, and long-term investment strategy that will weather the many ups and downs through financial markets that occur during your working years or beyond.

Many people worry about CPP being cut back or there not being enough money when they retire, but the truth is, the CPPIB is a world-class investment institution that is laying the foundation for retirement income for generations to come.  It is not designed to provide all your retirement saving, yet, it is a base that you may count on for life.

Final thoughts

For most people, there’s really no need to freak out about saving for your retirement. Come up with a retirement savings plan, stick to it, and know that there are resources out there to help your money grow.

3 Reasons why You Shouldn\'t Freak out About Saving for Retirement


  1. SD on November 7, 2018 at 12:07 AM

    I find that most articles/blog posts about saving money apply towards western culture. For example, the assumption that millenials have student debt, pay rent, etc. And of course these things apply to other cultures too, I’m not saying that this exclusively applies to Westerners. As an Asian Canadian, based on personal experience and those of my Asian friends, I find that there are some differences in how we save and spend our money. (Again, this is just a generalization, doesn’t apply to everyone.) For many of us, our parents pay our university tuition for us and we don’t move out until we get married. Our parents don’t charge us rent. However, we get older, we are expected to financially support our parents, and if we have kids, we’d likely pay their tuition as well. Have you considered writing a blog post that explores cultural differences like these? Do you think asians may need to take a different approach to saving/investing?

    • Barry Choi on November 7, 2018 at 9:22 AM


      YOu bring up some very good points. As the child of Asian immigrants, I did not have any student loans and I did stay at home until I got married. I think a post about this is definitely a must in the future

      • SD on November 7, 2018 at 11:53 PM

        Looking forward to it!

  2. Danielle Ogilvie on November 20, 2018 at 11:39 PM

    I like the idea of putting money aside for certain things you’re saving for before spending for fun.

    • Barry Choi on November 21, 2018 at 8:05 AM

      I do this for everything. I don’t spend money unless I’ve budgeted for it.

  3. Owen @ PlanEasy.ca on November 21, 2018 at 2:31 PM

    People need way less for retirement than they think (I just did a blog post about it actually!). I also hate the $1 million to $2 million figure that gets thrown around for retirement savings. For the average Canadian those numbers are CRAZY.

    A couple with $730,000 in savings at age 65, along with CPP and OAS, are in a great position for retirement.

    And if you start early, $730,000 isn’t that much, you can save that entire amount inside your TFSA and never touch an RRSP. All it takes is about $6,000 per year as a couple (maybe a bit more in the beginning if you have to catch up).

    • Barry Choi on November 23, 2018 at 2:42 PM


      Once I realized I didn’t need as much money as I thought I did, I made some lifestyle changes which I think improved the way I view money.

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