“CPP Is Changing: Here’s What They’re Not Telling You.”

Everyone needs to read and understand the information I'm about to share.

Over the next little while, some things are ending and some things are changing, and I’m going to walk you through exactly what they are and what they actually mean for you. I’m breaking this down by age group so everyone can see how these Canada Pension Plan changes hit differently depending on where you are in life. Then I’ll give you a couple of examples, and that’s where your comments come in again. Like and share this video, drop your comments below, and go off like you always do. You guys always light up the CPP threads, so let’s see if you do it again. I love reading them. Alright, let’s get into what’s going on with the Canada Pension Plan and the changes kicking in for 2026.

The first change is the basic one: the annual inflation increase. CPP goes up every single year based on inflation. This year, it’s only going up 2%. We saw higher increases a couple years back because inflation was out of control. Inflation is down now, so the increase is down too. Simple.

Next is the YMPE adjustment. YMPE is the Year’s Maximum Pensionable Earnings. That’s the salary cap the government uses to decide how much of your T4 income they’re going to tax for CPP contributions. Yes, I’m calling it a tax, because let’s be honest, that’s what it is. Some people like to pretend it’s “an investment,” but ask yourself: could you grow that money better somewhere else? Probably. But anyway, the government has set the maximum pensionable earnings at $74,600. That’s the income they base your CPP contributions on, and it’s gone up again this year.

Now we’ve got CPP2. That’s the new layer of the CPP. The government gave it another long acronym, the Year’s Additional Maximum Pensionable Earnings. This is the new band of income between $74,600 and $85,000, and it comes with an extra 4% tax if you’re still working. That money also gets taken and funneled into CPP.

Then there’s the wage-growth enhancement period, and this is what’s ending. From 2019 to the end of 2025, CPP has been going through a multi-year upgrade. The old CPP was designed to replace about a quarter of your working-year average income. The enhanced CPP is targeting one-third. That’s a meaningful bump, but not everyone is going to feel that bump equally. I’ll get into who gets what in a minute.

That same enhancement period also pushed the YMPE higher every year, and by the time it ends, it will have gone up by about 14%. But that whole upgrade program ends December 31st. No more enhancements for now. Going forward, CPP pretty much grows in two ways: the inflation adjustment every January and the annual increase to the YMPE.

So what does all this actually mean for you? Let’s go by age, because this hits people very differently. If you were already 65 and retired in 2019, none of these enhancements matter to you. You’re only getting the yearly inflation increase. So someone like Robert is just seeing that 2% bump and that’s it.

Now take Steve, still working and planning to retire in 2030. He’s been paying the higher CPP contribution rates, and if he earns above $75,000, he’s also paying into CPP2. But because he hasn’t been in the enhancement window long enough, he’s barely going to feel it. When he retires, he’ll get maybe $500 more a year from all those extra contributions.

Then there’s John, age 34. He’s been inside this enhancement period long enough to see a bit of a payoff. When he retires in 2050, he’s looking at maybe $2,500 more a year because he’s contributed more over more years, especially if he earns over that $75,000 band.

But the real winner is Connor, someone just stepping out of university today. He will get the full force of every enhancement because he’ll have contributed under the new rules for essentially his entire working life. When he retires around 2065, he’ll get around 50% more CPP than someone like Robert from the old system.

I hope this helped everyone understand better. Please share this knowledge with your friends and family.