Suze Orman says planning to work until 65 is a risky strategy — here's how Canadians can retire on their own terms

Most workers still expect to work straight through to 65 or beyond. Personal finance personality Suze Orman says that’s an admirable goal — but she warns it’s also a risky one to lean on completely.

“Working longer can make great sense,” Orman wrote in a recent blog post, adding that it gives retirement savings more time to grow and reduces how much a person needs to draw down early. But she cautions that even the most disciplined planner may not get to choose when they stop working. An unexpected health diagnosis or a family emergency can force the decision instead, as can business pressures like restructuring.

Why so many Canadians retire before they plan to

Statistics Canada puts the average retirement age at 65.4 years in 2025, up from 61.6 two decades earlier. But that average hides how often the timing isn’t the retiree’s choice.

Manulife’s survey found that most involuntary retirements were driven by personal health issues or caregiving responsibilities rather than layoffs or restructuring. Aimee DeCamillo, Manulife Wealth & Asset Management’s global head of retirement and wealth, has said that longevity is changing how much planning people need to do, as more plan members question whether their savings strategy will hold up over a longer retirement.

Peter Baker knows this firsthand. The Lunenburg, N.S., public works superintendent was forced into retirement at 61 after a bacterial infection led to septic shock, a brain infection and open-heart surgery. He had planned to work until 70. Once his long-term disability payments ran out, he found that CPP and OAS alone didn’t leave him and his wife much room to manoeuvre. “It makes a big change in your life,” he said.

That’s the disconnect Orman is trying to close. Most people assume they’ll be the one who gets to choose. Statistically, close to half won’t.

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The risks of banking on 65

If you’re already running retirement projections for age 65, it’s also worth stress-testing an earlier date — 60 or 62, say — even if you don’t plan on retiring then. A financial advisor or planner can help build out those scenarios.

The math changes considerably if retirement arrives ahead of schedule:

• CPP payments are reduced by 0.6% for every month collected before age 65, up to a maximum 36% reduction at age 60
• Delaying CPP past 65 increases payments by 0.7% a month, up to a maximum 42% boost at age 70
• OAS has no early-collection option before 65, but deferring it as late as age 70 adds 0.6% a month — up to 36% more — in monthly payments
• OAS is also subject to a clawback once net income passes $93,454, based on 2025 income, phasing out completely at $152,062 for those 65 to 74 or $157,923 for those 75 and up

The maximum CPP payment at 65 is $1,507.65 a month in 2026, though most retirees collect far less. None of that changes the underlying problem: CPP and OAS were never designed to fully replace an income, and starting either one early to bridge an involuntary retirement locks in a permanently smaller payment.

Suze Orman’s 2 tips to retire on your own terms

Orman’s advice was written for a U.S. audience, but the underlying strategy still holds for Canadians bracing for the possibility of an earlier-than-planned exit.

Pay off your mortgage before you retire

Orman calls a paid-off house one of the most powerful ways to cut retirement costs, since eliminating a mortgage payment dramatically lowers monthly expenses and takes pressure off other income sources to cover everything.

A paid-off home means one less fixed cost competing with CPP, OAS and RRSP withdrawals for a retiree’s monthly budget — a bigger deal if that budget arrives 5 or 10 years earlier than planned.

Get aggressive about saving in your 50s

In the U.S., Orman pointed to the catch-up contributions Americans 50 and older can make to a 401(k) or IRA without penalty.

However, Canada doesn’t have an age-based catch-up provision for RRSPs — the Canadian equivalent of a 401(k). Instead, unused RRSP contribution room carries forward indefinitely, so a bonus, inheritance or severance package can still be funnelled into decades of accumulated room. The 2026 RRSP contribution limit is 18% of the previous year’s earned income, up to $33,810. On top of that, TFSA room adds another $7,000 a year, with a cumulative limit of $109,000 for anyone who has been eligible since the account was introduced in 2009.