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The CPP Post-Retirement Benefit (PRB): How Continued Contributions Can Increase Your Pension

Learn how working after starting CPP lets you grow your retirement income with additional lifetime benefits

If you continue to work after beginning your Canada Pension Plan (CPP) retirement pension, your contributions don’t just disappear into the system. Instead, they go towards earning a Post-Retirement Benefit (PRB)—a valuable addition that increases your lifetime pension income.

Understanding how the PRB works ensures you fully benefit from continued work in retirement and make informed decisions about whether to keep contributing.

What Is the CPP Post-Retirement Benefit (PRB)?

The Post-Retirement Benefit (PRB) is an additional lifetime pension amount you earn by continuing to contribute to CPP after starting your retirement pension:

  • Each year you contribute to CPP while receiving retirement benefits generates a new PRB, paid monthly for life.

  • The PRB is added to your existing CPP pension and increases your overall retirement income.

  • PRBs are indexed to inflation, just like your main CPP payments.

There is no limit to how many PRBs you can earn—as long as you’re contributing, you’ll keep building them until age 70.

Who Is Eligible to Earn a PRB?

To be eligible for a PRB:

  • You must be receiving your CPP retirement pension.

  • You must be working and making CPP contributions.

If you’re under age 65, contributions are mandatory if you’re earning above the exemption threshold. From age 65 to 70, you can choose whether or not to continue contributing. After 70, contributions stop automatically.

Optimize helps you assess whether continuing contributions are worth it for your situation.

How Much Does the PRB Add to Your CPP?

The amount of each PRB depends on:

Factor Affecting PRB Explanation
Annual earnings Based on your yearly earnings, up to the maximum pensionable amount.
Contribution rates Set by the Canada Revenue Agency, applied to your eligible earnings.
Year-by-year calculation Each year’s PRB is calculated separately and added to your CPP.
Long-term accumulation Individual PRBs are modest, but they add up if you keep working several years.

Note: While individual PRBs are modest compared to your base CPP, they accumulate over time, especially if you continue working for several years after starting your pension.

Strategic Considerations: Should You Continue Contributing?

Whether to continue CPP contributions after age 65 depends on factors like:

  • Your current income needs.

  • How long you expect to keep working.

  • Tax implications of higher income.

  • The value of increasing guaranteed, inflation-protected lifetime income through PRBs.

For those expecting a long retirement or seeking to enhance guaranteed income, continuing to contribute can be a smart move. For others, especially high earners in higher tax brackets, opting out at 65 might make more sense.

Optimize works with you to weigh these factors and make the best decision.

How Optimize Helps You Maximize PRB Opportunities

At Optimize, we ensure you make the most of your continued work after starting CPP. We help you:

  • Calculate the potential PRB increases from ongoing contributions.

  • Assess whether to continue contributing after age 65.

  • Incorporate PRB projections into your retirement income planning.

  • Balance PRB benefits with tax efficiency, ensuring contributions are worthwhile.

  • Monitor your CPP strategy as your work situation evolves.

With Optimize’s guidance, the PRB becomes a valuable tool to enhance your retirement income, aligned with your personal financial goals.