To determine how much you need to retire, consider these key points:

• Income Replacement Ratio: Most experts recommend aiming for about 60-80% of your pre-retirement income annually to maintain a similar lifestyle in retirement. This range accounts for typically lower expenses in retirement, such as no longer saving for retirement, reduced commuting costs, and potentially lower taxes, but possibly higher healthcare and leisure expenses

• Typical Savings Amounts: Surveys and financial advisors suggest that a good ballpark figure for retirement savings for the average Canadian ranges from about $700,000 to $1 million, although this varies widely based on lifestyle, retirement age, and other income sources like pensions or government benefits

• Government Benefits: Your retirement income may include Canada Pension Plan (CPP) and Old Age Security (OAS), which should be factored into your total retirement income plan

• Savings Milestones: A general guideline for savings targets by age is:
  • 1x your salary by age 30
  • 3x by age 40
  • 6x by age 50
  • 8x by age 60
  • 10x by age 67
    Saving about 10 times your pre-retirement income by retirement age is often suggested to maintain your lifestyle

• Personalized Calculators: Using retirement calculators (e.g., from Sun Life, Wealthsimple, Canada.ca, NerdWallet) can help you estimate how much you need based on your current savings, expected retirement age, lifestyle, and other factors

• Lifestyle Considerations: Your desired retirement lifestyle heavily influences how much you need. For example, an active retirement with travel may require 70% or more of your pre-retirement income, while a modest retirement might only need about 50%

• Start Saving Early: The earlier you start saving and investing, the easier it is to reach your retirement goals due to compound interest. For example, saving consistently from your 20s requires less monthly contribution than starting later

In summary, you typically need to save enough to provide 60-80% of your pre- retirement income annually, factoring in government benefits, personal savings, and lifestyle choices. This often translates to accumulating around 8-10 times your annual salary by retirement age, but personalized calculations and financial advice are recommended to tailor this to your situation.